The AP-1 transcription factor c-Jun is essential for cellular proliferation in many cell types, but the molecular link between growth factors and c-Jun activation has been enigmatic. In this study we identify a previously uncharacterized RING-domain-containing protein, RACO-1 (RING domain AP-1 co-activator-1), as a c-Jun co-activator that is regulated by growth factor signalling. RACO-1 interacted with c-Jun independently of amino-terminal phosphorylation, and was both necessary and sufficient for c-Jun/AP-1 activation. Growth factor-mediated stimulation of AP-1 was attributable to MEK/ERK-dependent stabilization of RACO-1 protein. Stimulation of the MEK/ERK pathway strongly promoted Lys 63-linked ubiquitylation of RACO-1, which antagonized Lys 48-linked degradative auto-ubiquitylation of the same Lys residues. RACO-1 depletion reduced cellular proliferation and decreased expression of several growth-associated AP-1 target genes, such as cdc2, cyclinD1 and hb-egf. Moreover, transgenic overexpression of RACO-1 augmented intestinal tumour formation triggered by aberrant Wnt signalling and cooperated with oncogenic Ras in colonic hyperproliferation. Thus RACO-1 is a co-activator that links c-Jun to growth factor signalling and is essential for AP-1 function in proliferation.