A gene has been isolated from an activated T cell library that appears to encode a novel low molecular weight GTP-binding protein that demonstrates approximately 20 percent homology to c-Ha-ras. This gene has been designated RAI-1 for transcriptionally induced ras-related protein. RAI-1 codes for a 32 kdalton protein that contains consensus GTP binding elements, although the G-3 element is imperfect. RAI-1 differs from c-ras proteins by the presence of amino and carboxy-terminal extensions and the absence of an acceptor site for isoprenylation. RAI-1 message is transiently expressed in mitogen-activated T cells and fibroblasts and in PMA-activated blood monocytes. The specific biological function of RAI-1 is not known as yet, although it should be noted that low molecular weight GTP binding proteins act as molecular switches in the cell for functions as diverse as receptor signalling and vesicle transport. The GTP binding activity of native RAI-1 protein and the subcellular location of RAI-1 are being investigated.