Our initial characterization of Rac3, a close relative of the small GTPase Rac1, established its ability to promote membrane ruffling, transformation, and activation of c-jun transcriptional activity. The finding that Rac3 is transforming, and its similarity to Rac1, a protein that has a well-established connection to many processes important for cancer progression, prompted further investigation into Rac3 transformation. We used effector domain mutants (EDMs) to explore the relationship among Rac signaling, transformation, and effector usage. All Rac3 EDMs tested (N26D, F37L, Y40C, and N43D) retained the ability to promote membrane ruffling and focus formation. In contrast, only the N43D mutant promoted anchorage independence. This differs from Rac1, where both N26D and N43D mutants were impaired in both types of transformation. To learn more about the signaling pathways involved, we did luciferase reporter assays and glutathione S-transferase pull-down assays for effector binding. We found evidence for a functional link between activation of phospholipase Cbeta2 by Rac3 and signaling to the serum response factor (SRF). Surprisingly, we also found that Rac3 binds poorly to the known Rac1 effectors mixed lineage kinases 2 and 3 (MLK2 and MLK3). Transcription of cyclin D1 was the only pathway that correlated with growth in soft agar. Our experiments show that activation of membrane ruffling and transcriptional activation of c-jun, SRF, or E2F are not sufficient to promote anchorage-independent growth mediated by Rac3. Instead, multiple effector pathways are required for Rac3 transformation, and these overlap partially but not completely with those used by Rac1.