Members of the Ras subfamily of GTP-binding proteins, including Ras (H-, K-, and N-), TC21, and R-ras have been shown to display transforming activity, and activating lesions have been detected in human tumors. We have identified an additional member of the Ras gene family which shows significant sequence similarity to the human TC21 gene. This novel human ras-related gene, R-ras3, encodes for a protein of 209 amino acids, and shows approximately 60-75% sequence identity in the N-terminal catalytic domain with members of the Ras subfamily of GTP-binding proteins. An activating mutation corresponding to the leucine 61 oncogenic lesion of the ras oncogenes when introduced into R-ras3, activates its transforming potential. R-ras3 weakly stimulates the mitogen-activated protein kinase (MAPK) activity, but this effect is greatly potentiated by the co-expression of c-raf-1. By the yeast two-hybrid system, R-ras3 interacts only weakly with known Ras effectors, such as Raf and RalGDS, but not with RglII. In addition, R-ras3 displays modest stimulatory effects on trans-activation from different nuclear response elements which bind transcription factors, such as SRF, ETS/TCF, Jun/Fos, and NF-kappaB/Rel. Interestingly, Northern blot analysis of total RNA isolated from various tissues revealed that the 3.8 kilobasepair (kb) transcript of R-ras3 is highly restricted to the brain and heart. The close evolutionary conservation between R-ras3 and Ras family members, in contrast to the significant differences in its biological activities and the pattern of tissue expression, raise the possibility that R-ras3 may control novel cellular functions previously not described for other GTP-binding proteins.