The dbl oncogene product contains a 238-amino acid domain, which is shared by an expanding family of growth regulatory proteins. These include the Saccharomyces cerevisiae cell division cycle protein, CDC24, the breakpoint cluster region protein, the ect2 and vav oncogene products, and the brain GDP-releasing factor for Ras. Previous studies have provided evidence that oncogenic Dbl or an associated protein stimulates GDP dissociation from the human species (Hs) homolog of CDC42. We show here that Dbl specifically complexes with the GDP-bound forms of CDC42Hs and RhoA, but not Rac1 or TC10, and that this specificity correlates with the ability of Dbl to act as a GDP-releasing factor. Small deletions throughout the Dbl domain, which inactivate transformation, eliminated the ability of Dbl to stimulate GDP dissociation, whereas deletions outside of this domain did not impair either function. Finally, the Dbl domain itself, when expressed and purified as a recombinant protein, was shown to stimulate GDP dissociation from purified, recombinant CDC42Hs. These findings establish that a minimal unit on Dbl that is critical to its transforming function directly regulates GDP-GTP exchange activity.