The p21-activated protein kinases (Paks) are serine/threonine protein kinases activated by binding to Rho family small GTPases, Rac and Cdc42. Recently, Pak family members have been subdivided into two groups, I and II. Group II Paks, including Pak4, Pak5, and Pak6, does not contain the highly conserved autoinhibitory domain that is found in the group I Paks members, i.e. Pak1, Pak2, and Pak3. In the present study, we have purified the glutathione S-transferase fusion form of Pak5 and shown for the first time that Pak5 autophosphorylation can be activated by GTP bound form of Cdc42. Mutation of histidine residues 19 and 22 to leucine on the p21-binding domain of Pak5 completely abolished the binding of Cdc42 and the Cdc42-mediated autophosphorylation. On the other hand, mutation of tyrosine 40 to cysteine of Cdc42 did not knockout the binding of Pak5. Analysis of C-terminal deletion mutants has identified an autoinhibitory fragment of Pak5 that is absent from other group II Pak family members. Taken together, these results suggest that Pak5, like Pak1, contains an autoinhibitory domain and its activity is regulated by Cdc42.