Ras GTPase-activating protein (GAP) contains two Src homology 2 (SH2) domains which are implicated in binding to tyrosine-phosphorylated sites in specific activated growth factor receptors and to a cytoplasmic tyrosine-phosphorylated protein, p62. We have used site-directed mutagenesis of the two GAP SH2 domains (SH2-N and SH2-C) to identify residues involved in receptor and p62 binding. A bacterial fusion protein containing the precise SH2-N domain, as defined by sequence homology, associated with both the activated beta platelet-derived growth factor receptor and epidermal growth factor receptor, and p62 in vitro. However, short deletions at either the N or C termini of the SH2-N domain abolished binding, suggesting that the entire SH2 sequence is required for formation of an active domain. Conservative substitutions of 2 highly conserved basic residues in the SH2-N domain, an arginine and a histidine, resulted in complete loss of receptor and p62 binding, whereas other basic residues, and residues at variable SH2 sites, were more tolerant of substitution. The conserved arginine and histidine therefore appear critical for association with phosphotyrosine-containing proteins, possibly through an interaction with phosphotyrosine. The GAP SH2-C domain, unlike SH2-N, does not bind efficiently to activated receptors or p62 in vitro. The SH2-C domain lacks 3 residues which are otherwise well conserved, and contribute to high affinity SH2-N binding. Replacement of 1 of these residues, a cysteine, with the consensus glycine, conferred SH2-C binding activity toward tyrosine-phosphorylated p62 and epidermal growth factor receptor. Loss-of-function and gain-of-function mutations in the GAP SH2 domains can therefore be used to identify residues that are critical for receptor and p62 binding.