BALB/3T3 cells were transformed by transfection with DNA encoding the mutated ras(Q(61)K) from shrimp Penaeus japonicus (Huang and Chuang. 1999. J Exp Zool 283:510-521). The caveolin-1 in the membrane fraction extractable with 2% octyl glucoside was significant reduced, compared to untransformed cells. To understand this in more detail, the interaction of S-Ras with caveolin was investigated using caveolin-1 purified from rat lungs. The purified caveolin-1 binds c-Src, suppressing its autophosphorylation. It also binds to phosphatidylserine-cholesterol liposomes. These reconstituted caveolin-phosphatidylserine-cholesterol vesicles, which act as a model of caveolae, recruit both bacterially expressed S-Ras and rat K(B)-Ras proteins, as demonstrated on western blots with antibodies against caveolin-1 and Ras. Caveolin-1 suppressed the intrinsic GTPase activity of S-Ras, sustaining it in the active GTP bound form. By contrast, caveolin-1 enhanced the intrinsic GTPase activity of K(B)-Ras, to convert it into the inactive GDP-bound form. These events suggest that caveolin may act as a docking site for Ras proteins and may be able to either maintain or alter their activity state. These events may be associated with the ability of S-ras(Q(61)K) to successfully transform cells.