We have established a novel role for the second messenger DAG (diacylglycerol), a product of PtdIns(4,5)P2 hydrolysis by PLC (phospholipase C). In addition to its well-known function as a protein kinase C activator, DAG produced by stimulation of the epidermal growth factor receptor causes the redistribution of the Rac-GAP (GTPase-activating protein) β2-chimaerin to the plasma membrane, where it associates with the active form of Rac1 and promotes the inactivation of this small G-protein. This represents the first example of a Rac-GAP regulated directly by DAG in response to the activation of a tyrosine kinase receptor, and suggests a previously unappreciated role for this lipid as a negative modulator of Rac signalling.

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