The small GTPase Rit is a close relative of Ras, and constitutively active Rit can induce oncogenic transformation. Although the effector loops of Rit and Ras are highly related, Rit fails to interact with the majority of the known Ras candidate effector proteins, suggesting that novel cellular targets may be responsible for Rit transforming activity. To gain insight into the cellular function of Rit, we searched for Rit-binding proteins by yeast two-hybrid screening. We identified the C-terminal Rit/Ras interaction domain of a protein we have designated RGL3 (Ral GEF-like 3) that shares 35% sequence identity with the known Ral guanine nucleotide exchange factors (RalGEFs). RGL3, through a C-terminal 99-amino acid domain, interacted in a GTP- and effector loop-dependent manner with Rit and Ras. Importantly, RGL3 exhibited guanine nucleotide exchange activity toward the small GTPase Ral that was stimulated in vivo by the expression of either activated Rit or Ras. These data suggest that RGL3 functions as an exchange factor for Ral and may serve as a downstream effector for both Rit and Ras.