Rac GTPases are key regulators of cell shape and cytoskeletal organization. While some regulators of Rac activity are known, such as GTPase-activating proteins (GAPs) that repress Rac activity, other Rac regulators remain to be identified. The novel Caenorhabditis elegans WD-repeat protein SWAN-1 was identified in a yeast two-hybrid screen with the LIM domains of the Rac effector UNC-115/abLIM. SWAN-1 was found to also associate physically with Rac GTPases. The swan-1(ok267) loss-of-function mutation suppressed defects caused by the hypomorphic ced-10(n1993) allele and enhanced ectopic lamellipodia and filopodia formation induced by constitutively active Rac in C. elegans neurons. Furthermore, SWAN-1(+) transgenic expression suppressed the effects of overactive Rac, including ectopic lamellipodia and filopodia formation in C. elegans neurons, ectopic lamellipodia formation in cultured mammalian fibroblasts, and cell polarity and actin cytoskeleton defects in yeast. These studies indicate that SWAN-1 is an inhibitor of Rac GTPase function in cellular morphogenesis and cytoskeletal organization. While broadly conserved across species, SWAN-1 family members show no sequence similarity to previously known Rac inhibitors.