Loss-of-function mutations in the NF1 tumor suppressor gene underlie the familial cancer syndrome neurofibromatosis type I (NF1). The NF1-encoded protein, neurofibromin, functions as a Ras-GTPase activating protein (RasGAP). Accordingly, deregulation of Ras is thought to contribute to NF1 development. However, the critical effector pathways involved in disease pathogenesis are still unknown. We show here that the mTOR pathway is tightly regulated by neurofibromin. mTOR is constitutively activated in both NF1-deficient primary cells and human tumors in the absence of growth factors. This aberrant activation depends on Ras and PI3 kinase, and is mediated by the phosphorylation and inactivation of the TSC2-encoded protein tuberin by AKT. Importantly, tumor cell lines derived from NF1 patients, and a genetically engineered cell system that requires Nf1-deficiency for transformation, are highly sensitive to the mTOR inhibitor rapamycin. Furthermore, while we show that the activation of endogenous Ras leads to constitutive mTOR signaling in this disease state, we also demonstrate that in normal cells Ras is differentially required for mTOR signaling in response to various growth factors. Thus, these findings identify the NF1 tumor suppressor as an indispensable regulator of TSC2 and mTOR. Furthermore, our results also demonstrate that Ras plays a critical role in the activation of mTOR in both normal and tumorigenic settings. Finally, these data suggest that rapamycin, or its derivatives, may represent a viable therapy for NF1.