Lte1 is a mitotic regulator long envisaged as a guanosine nucleotide exchange factor (GEF) for Tem1, the small guanosine triphosphatase governing activity of the Saccharomyces cerevisiae mitotic exit network. We demonstrate that this model requires reevaluation. No GEF activity was detectable in vitro, and mutational analysis of Lte1's putative GEF domain indicated that Lte1 activity relies on interaction with Ras for localization at the bud cortex rather than providing nucleotide exchange. Instead, we found that Lte1 can determine the subcellular localization of Bfa1 at spindle pole bodies (SPBs). Under conditions in which Lte1 is essential, Lte1 promoted the loss of Bfa1 from the maternal SPB. Moreover, in cells with a misaligned spindle, mislocalization of Lte1 in the mother cell promoted loss of Bfa1 from one SPB and allowed bypass of the spindle position checkpoint. We observed that lte1 mutants display aberrant localization of the polarity cap, which is the organizer of the actin cytoskeleton. We propose that Lte1's role in cell polarization underlies its contribution to mitotic regulation.