Oligonucleotide-directed, site-specific mutagenesis is used to dissect the biochemical basis of oncogenic activation and enzymatic activity of the ras oncogene. Point mutations of p21 proteins were constructed by oligonucleotide-directed mutagenesis of the v-ras-H oncogene, which substituted amino acid residues within the presumptive nucleotide- binding consensus sequence, GXGGXGK. When the glycine residue at positions 10, 13, or 15 was substituted with valine, the viral ras- H product, p21, lost its guanosine triphosphate (GTP)-binding and autokinase activities. Other substitutions at position 22, 33, 51 or 59 did not impair its binding activity. G418-resistant NIH 3T3 cell lines were derived by transfection with constructs obtained by inserting the mutant proviral DNA into the pSV2neo plasmid. Clones with valine mutation at positions 13 or 15 were incapable of morphologically transforming cells, while all other mutants with GTP-binding activity were competent. Ras, with a valine mutation at glycine-10, which had lost its ability to bind GTP and its autokinase activity in vitro and in vivo, was fully capable of transforming NIH 3T3 cells. These cells grew in soft agar and formed tumors in nude mice. The p21 of cell lines derived from tumor explants still lacked the autokinase activity. In contrast, cells transfected with position-valine or a position-116 tyrosine ras mutant were tumorigenic in nude mice, but not immunocompetent in Balb/c mice. Cells transfected with the 15 valine mutant, however, did not consistently induce tumors in nude mice.