The function of all Ras proteins requires CaaX (Cys-aliphatic-aliphatic-X) box processing. The steps include farnesylation, removal of the three terminal residues (-aaX), carboxymethylation and palmitoylation. To further define the role of C-terminal modifications on Ras function a series of C-terminal RAS2 mutants were constructed. It has been possible to construct a non-prenylated Ras proteins that are functional, albeit at a reduced level of activity. The CaaX-box defective RAS mutants were used in a screen to identify new proteins required for Ras protein function. Five complementation groups were identified. One mutant,erf4 is allelic to SHR5 (Jung et al Mol. Cell. Biol. 15, 1333-1342, 1995), previously identified as a suppressor of a dominant RAS2 mutant. A second mutant, erf2, encodes a novel 41 kDa protein with 4 predicted transmembrane domains and a novel cysteine rich motif in the cytoplasmic loop with sequence similarity to AKR1 (Kao et al. Mol. Cell. Biol. 16, 168-178, 1996) and a family of uncharacterized proteins in S. cerevisiae, S. pombe, and C. elegans. Genetic and physical interactions between ERF2 and RAS2 will be presented.