Vegetative incompatibility is widespread in fungi but its molecular mechanism and biological function are still poorly understood. A way to study vegetative incompatibility is to investigate the function of genes whose mutations suppress this phenomenon. In Podospora anserina, these genes are known as mod genes. In addition to suppressing vegetative incompatibility, mod mutations cause some developmental defects. This suggests that the molecular mechanisms of vegetative incompatibility and development pathways are interconnected. The mod-E1 mutation was isolated as a suppressor of the developmental defects of the mod-D2 strain. We show here that mod-E1 also partially suppresses vegetative incompatibility, strengthening the link between development and vegetative incompatibility. mod-E1 is the first suppressor of vegetative incompatibility characterized at the molecular level. It encodes a member of the Hsp90 family, suggesting that development and vegetative incompatibility use common steps of a signal transduction pathway. The involvement of mod-E in the sexual cycle has also been further investigated.