RalGDS is a GDP/GTP exchange protein for ral p24, a member of small GTP-binding protein superfamily. We have recently shown that RalGDS interacts directly with the GTP-bound active form of ras p21 through the effector loop of ras p21 in vitro, in insect cells and in the yeast two-hybrid system. These results suggest that RalGDS functions as an effector protein of ras p21. Here, we report that RalGDS interacts with ras p21 in mammalian cells in response to an extracellular signal. Epidermal growth factor (EGF) induced the interaction of c-ras p21 and RalGDS in COS cells expressing both proteins, but not in the cells expressing RalGDS and c-ras p21T35A, which is an effector loop mutant of ras p21. We also found that cyclic AMP-dependent protein kinase (protein kinase A) regulated the selectivity of ras p21-binding to either RalGDS or Raf-1. Protein kinase A phosphorylated RalGDS as well as (1-149)Raf (amino acid residues 1-149). Although the phosphorylated (1-149)Raf had a lower affinity for ras p21 than the unphosphorylated (1-149)Raf, both the phosphorylated and unphosphorylated RalGDS had the similar affinities for ras p21. The phosphorylation of RalGDS did not affect its activity to stimulate the GDP/GTP exchange of ral p24. Pretreatment of COS cells with forskolin further stimulated the interaction of ras p21 and RalGDS induced by EGF under the conditions that EGF-dependent Raf-1 activity was inhibited. These results indicate that ras p21 distinguishes between RalGDS and Raf-1 by their phosphorylation by protein kinase A.