Yeast is a unicellular fungus hand fungi have a saprophytic mode of nutrition. This means they cannot produce their own food but require an external source of carbon and energy. Therefore, it cannot grow in water as water does not have any carbon or energy source required for their growth, while it can grow in sugar solution, where it ferments sugar to produce energy and will have a carbon source for growth. Hence, colonies of yeast can be observed in sugar solution but cannot be observed in water.
