smg GDP dissociation stimulator (GDS) is a stimulatory GDP/GTP exchange protein for a group of ras p21-like small GTP-binding proteins (G proteins) including c-Ki-ras p21, smg p21A, smg p21B, and rhoA p21. smg GDS converts the GDP-bound inactive form to the GTP-bound active form of each small G protein by stimulating their GDP/GTP exchange reaction in a cell-free system. The point-mutated c-Ki-ras p21 (c-Ki-rasval12 p21) is known to strongly transform NIH/3T3 cells and to markedly stimulate the c-fos promoter/enhancer in this cell line, whereas the normal c-Ki-ras p21 is weak in these activities. In the present study, we examined the effect of smg GDS on these activities to explore its physiological function. Overexpression of both smg GDS and c-Ki-ras p21 strongly transformed NIH/3T3 cells, whereas overexpression of either smg GDS or c-Ki-ras p21 alone weakly transformed the cells. Furthermore, overexpression of both smg GDS and c-Ki-ras p21 markedly stimulated the c-fos promoter/enhancer in NIH/3T3 cells, whereas overexpression of either smg GDS or c-Ki-ras p21 alone weakly stimulated it. These results indicate that smg GDS transforms NIH/3T3 cells and stimulates the c-fos promoter/enhancer in this cell line in cooperation with c-Ki-ras p21.