Choleragen (cholera toxin) catalyzes the ADP-ribosylation of Gs alpha, the stimulatory guanine nucleotide-binding protein (GNP) of the adenylyl cyclase system which couples hormone or neurotransmitter receptors to the cyclase catalytic unit. ADP- ribosylation of Gs alpha increases sensitivity to activation by GTP by inhibiting its intrinsic GTPase, thereby ultimately activating adenylyl cyclase and raising intracellular cyclic AMP. Recently, one membrane and two soluble guanine nucleotide-binding proteins that enhance the choleragen-catalyzed ADP-ribosylation of Gs alpha have been purified from bovine brain. These ADP. ribosylation factors (ARFs) also serve as toxin substrates. To define the structure and function of the ARFs, we isolated a cDNA clone from a bovine retinal library using a mixed oligonucleotide probe whose sequence was based on the partial amino acid sequence of a bovine brain soluble ARF. There were only two differences between the deduced amino acid sequence of clone lambda ARF2B and sequences of two CNBr peptides of the ARF protein (60 amino acids total). Comparison of the deduced amino acid sequences of ARF, Go alpha (GNP isolated from bovine brain and thought to regulate ion channels), and c-Ha-ras p21 protein revealed similarities in regions putatively involved in guanine nucleotide binding and GTP hydrolysis. ARF lacks a sequence analogous to the site of choleragen modification in the c subunits of the GNPs. We conclude that ARF is a GNP that interacts with the Al subunit of choleragen in a manner quite different from other GNPs. This interaction modifies the catalytic properties of the toxin, in addition to allowing the ARF protein to act as a substrate for ADP- ribosylation.