Ras (p21^ras) interacts directly with the catalytic subunit of phosphatidylinositol-3-OH kinase in a GTP-dependent manner through the Ras effector site. In vivo, dominant negative Ras mutant N17 inhibits growth factor induced production of 3′ hosphorylated phosphoinositides in PC12 cells, and transfection of Ras, but not Raf, into COS cells results in a large elevation in the level of these lipids. Therefore Ras can probably regulate phosphatidylinositol-3-OH kinase, providing a point of divergence in signalling pathways downstream of Ras.