Background A gene network's capacity to process information, so as to bind past events to future actions, depends on its structure and logic. From previous and new microarray measurements in Saccharomyces cerevisiae following gene deletions and overexpressions, we identify a core gene regulatory network (GRN) of functional interactions between 328 genes and the transfer functions of each gene. Inferred connections are verified by gene enrichment. Results We find that this core network has a generalized clustering coefficient that is much higher than chance. The inferred Boolean transfer functions have a mean p-bias of 0.41, and thus similar amounts of activation and repression interactions. However, the distribution of p-biases differs significantly from what is expected by chance that, along with the high mean connectivity, is found to cause the core GRN of S. cerevisiae's to have an overall sensitivity similar to critical Boolean networks. In agreement, we find that the amount of information propagated between nodes in finite time series is much higher in the inferred core GRN of S. cerevisiae than what is expected by chance. Conclusions We suggest that S. cerevisiae is likely to have evolved a core GRN with enhanced information propagation among its genes.