The gene corresponding to the S. cerevisiae cell division cycle mutant cdc25 has been cloned and sequenced, revealing an open reading frame encoding a protein of 1589 amino acids that contains no significant homologies with other known proteins. Cells lacking CDC25 have low levels of cyclic AMP and decreased levels of Mg2+-dependent adenylate cyclase activity. The lethality resulting from disruption of the CDC25 gene can be suppressed by the presence of the activated RAS2val19 gene, but not by high copy plasmids expressing a normal RAS2 or RAS1 gene. These results suggest that normal RAS is dependent on CDC25 function. Furthermore, mutationally activated alleles of CDC25 are capable of inducing a set of phenotypes similar to those observed in strains containing a genetically activated RAS/adenylate cyclase pathway, suggesting that CDC25 encodes a regulatory protein. We propose that CDC25 regulates adenylate cyclase by regulating the guanine nucleotide bound to RAS proteins.