The putative tumor metastasis suppressor nm23H1 was originally identified in murine melanomas by subtraction cloning. It displays nucleoside diphosphate kinase activity and regulates cellular events, including growth and development. Recently nm23H1 has been reported to also act as a GTPase-activating protein of the Ras-related GTPase Rad. We attempted to determine whether nm23H1 also regulates Rho-family GTPases. Although we were unable to detect a direct association between nm23H1 and Rho-family GTPases, nm23H1 was shown to be associated with a Rac1-specific nucleotide exchange factor, Tiam1, by interaction with its amino-terminal region in extracts from the cells expressing exogenous Tiam1 and from native tissue. Overexpression of nm23H1 inhibited the Tiam1-induced production of GTP-bound Rac1 and activation of c-Jun kinase. On the other hand, forced overexpression of the wild type, but not the kinase-inactivated mutant of nm23H1, converted the GDP-bound forms of Rac1, Cdc42, and RhoA to their GTP-bound forms in vitro by its nucleoside diphosphate kinase activity, but nm23H1 alone apparently did not produce the GTP-bound form of these GTPases in vivo. These results suggest that nm23H1 negatively regulates Tiam1 and inhibits Rac1 activation in vivo. Moreover, adhesion-stimulated membrane ruffles of Rat1 fibroblasts were reduced by overexpression of nm23H1. Based on these observations, we concluded that we had identified a function of nm23H1 as a regulator of Rac1 and that it may be related to the effect of nm23H1 as a tumor metastasis suppressor.