We demonstrate that both c-N-Ras and c-K(B)-Ras are constitutively associated with purified mitochondria. c-K(B)-Ras is associated with the mitochondrial outer membrane, and c-N-Ras is associated with both the outer membrane and inner mitochondrial compartments. The mitochondrial morphology is abnormal in both c-N-Ras negative and K-Ras negative cells. Normal mitochondrial morphology was restored by targeting N-Ras to both the inner and outer mitochondrial compartments, or by ectopically expressing c-K(B)-Ras. Impaired mitochondrial function can result in increased CHOP and NFkappaB activity, typical for a retrograde signaling response. Both are constitutively elevated in the N-Ras negative cells, but not in the K-Ras negative background, and are restored by c-N-Ras targeted exclusively to the inner mitochondrial compartment. Surprisingly, both targeting and the ability to functionally reduce retrograde transcriptional activity were found to be independent of c-N-Ras farnesylation. Overall, these data demonstrate for the first time a (1) farnesylation independent function for c-N-Ras and (2) that N-Ras within the inner mitochondrial compartment is an essential component of the retrograde signaling system between the mitochondria and nucleus.