FGD1 mutations result in faciogenital dysplasia, an X-linked human disease that affects skeletogenesis. FGD1 encodes a guanine nucleotide exchange factor (GEF) that specifically activates the Rho GTPase Cdc42. To gain insight into the function of FGD1, we have isolated and characterized fgd-1, the Caenorhabditis elegans homolog of the human FGD1 gene. Comparative sequence analyses show that fgd-1 and FGD1 share a similar structural organization and a high degree of sequence identity throughout shared signaling domains. In nematodes, interference with fgd-1 expression results in excretory cell abnormalities and cystic dilation of the excretory cell canals. Molecular lesions associated with two exc-5 alleles affect the fgd-1 gene, and fgd-1 transgenic expression rescues the Exc-5 phenotype. Together, these data confirm that the fgd-1 transcript corresponds to the exc-5 gene. Transgenic expression studies show that fgd-1 has a limited pattern of expression that is confined to the excretory cell during development, a finding that suggests that the C.elegans FGD-1 protein might function in a cell autonomous manner. Serial observations indicate that fgd-1 mutations lead to developmental excretory cell abnormalities that cause cystic dilation and interfere with canal process extension. Based on these data, we conclude that fgd-1 is the C.elegans homolog of the human FGD1 gene, a new member of the FGD1-related family of RhoGEF genes, and that fgd-1 plays a critical role in excretory cell morphogenesis and cellular organization.