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The Rho family of small GTP-binding proteins plays important roles in the regulation of actin cytoskeleton organization and cell growth. Activation of these GTPases involves the replacement of bound GDP with GTP, a process catalyzed by the Dbl-like guanine-nucleotide exchange factors, all of which seem to share a putative catalytic motif termed the Dbl homology (DH) domain, followed by a pleckstrin homology (PH) domain. Here we have examined the role of a Dbl-like molecule, the faciogenital dysplasia gene product (FGD1), which when mutated in its Dbl homology domain, cosegregates with the developmental disease Aarskog-Scott syndrome. We report that a polypeptide of FGD1 encompassing the DH and PH domains can bind specifically to the Rho family GTPase Cdc42Hs and stimulates the GDP-GTP exchange of the isoprenylated form of Cdc42Hs. Microinjection of this FGD1 polypeptide into Swiss …