We have cloned, sequenced, and examined the regulation of a Dictyostelium gene encoding a protein homologous to mammalian ras proteins. The Dictyostelium, yeast, and mammalian proteins have homologous N-terminal regions and less conserved C-terminal regions. We have used DNA probes and a polyclonal antibody to examine the differential accumulation of ras RNA and protein through development. The gene encodes two mRNAs (0.9 and 1.2 kb) that are differentially expressed. The 1.2 kb RNA is found in vegetative cells and disappears rapidly upon initiation of development. Later, both RNAs accumulate preferentially in prestalk cells. The level of the Dd-ras protein remains constant until early culmination and then decreases. Like other prestalk genes, Dd-ras can be induced with cAMP in the absence of cell contact. When aggregated cells are dissociated, both mRNAs decrease. Upon addition of cAMP, the 1.2 kb mRNA reaccumulates at a higher level than that in normal developing cells. The presence of the Dd-ras protein in vegetative cells corroborates other reports suggesting a possible function during cell growth. The sustained level of Dd-ras protein in prestalk cells suggests an additional role during differentiation.