Author Summary In budding yeast, cell polarization (or the asymmetric distribution of subcellular components) ensures the targeted transport of proteins and membrane material to the sites of cell growth or cell division in late mitosis. Two conserved members of the Rho-GTPase family, Rho1 and Cdc42, are master regulators of cell polarity. While Rho1 has a well-established role in cytokinesis and cell separation, Cdc42 helps to establish the new polarity site from which the future daughter cell will grow after cytokinesis. Interestingly, despite the fact that Cdc42 is recruited to the site of cell division at the same time as Rho1, the new daughter cell never emerges from the site previously used for cytokinesis during the preceding cell cycle, and it remains elusive how cells coordinate the distinct functions of Rho1 and Cdc42 during cytokinesis. Here, we show that the novel protein Gps1 marks the cell division site, where it maintains Rho1-dependent polarity until cell separation is completed. We also demonstrate that Gps1 prevents activation of Cdc42 at the site of cell division during cytokinesis. We propose that Gps1 provides a novel polarity cue that guides the establishment of a new polarity site, away from the old site of cell division, where the new daughter cell then emerges.