Mammalian ras oncogenes encode polypeptides of relative molecular mass (Mr) 21,000 (p21) which bind GTP and GDP. Oncogenic ras-encoded proteins differ from their normal homologues by an amino acid substitution for Gly 12, Ala 59 or Gln 61. Recently, we and others have observed that normal p21, encoded by the Ha-ras gene, has a GTP hydrolytic activity that is reduced by the oncogenic substitutions Val 12 or Thr 59. The yeast Saccharomyces cerevisiae contains two ras-related genes, RASsc1 and RASsc2, the expression of either of which is sufficient for viability. RASsc1 and RASsc2 encode proteins of 309 (SC1) and 322 (SC2) residues which are 62% homologous to mammalian p21 in their 172-amino acid N-terminal sequences. We report here that the N-terminal domain of SC1 binds GTP and GDP and has a GTP hydrolytic activity that is reduced in the variants SC1[Thr 66] and SC1[Leu 68] which are analogous to oncogenic Ha[Thr 59] and Ha[Leu 61], respectively. These results suggest that yeast and mammalian ras proteins have similar biochemical and possibly biological functions.