The mouse ect2 oncogene was identified in a search of mitogenic signal transducers using a novel expression cloning strategy. In this system, the introduction of an appropriate expression-cDNA library prepared from the mRNA of one cell type into another can result in the morphological transformation of the recipient cells. The predicted Ect2 protein has sequence similarity within a central core of 255 amino acids to the products of the breakpoint-cluster gene, bcr, the yeast cell cycle gene, CDC24, the dbl and vav oncogenes, and the RasGrf gene. Baculovirus-expressed Ect2 protein shows specific binding to Rho and Rac proteins, indicating that Ect2 is a new member of transforming proteins that can interact with Rho-like proteins of the Ras superfamily. The ect2 foci exhibit an unusual stellate morphology and are capable of forming tumors when subcutaneously inoculated in nude mice. These results indicate that the ect2 gene acts as an oncogene. To investigate the involvement of the ect2 in human tumors, the authors isolated the human homolog, ECT2, of mouse ect2 and determined its chromosomal localization. 13 refs., 1 fig.