Rho1p regulates cell integrity by controlling the actin cytoskeleton and cell wall synthesis. We have identified a new GEF, designated Rgf1p, which specifically regulates Rho1p during polarized growth. The phenotype of rgf1 null cells was very similar to that seen after depletion of Rho1p, 30% of cells being lysed. In addition, rgf1(+) deletion caused hypersensitivity to the antifungal drug Caspofungin and defects in the establishment of bipolar growth. rho1(+), but none of the other GTPases of the Rho-family, suppressed the rgf1Delta phenotypes. Moreover, deletion of rgf1(+) suppressed the severe growth defect in rga1(+) null mutants (a Rho1-GAP, negative regulator). Rgf1p and Rho1p coimmunoprecipitated and overexpression of rgf1(+) specifically increased the GTP-bound Rho1p; it caused changes in cell morphology, and a large increase in beta(1,3)-glucan synthase activity. These effects were similar to those elicited when the hyperactive rho1-G15V allele was expressed. A genetic relationship was observed between Rgf1p, Bgs4p (beta[1,3]-glucan synthase), and Pck1p (protein kinase C [PKC] homologue); Bgs4p and Pck1p suppressed the hypersensitivity to Caspofungin in rgf1Delta mutants. Rgf1p localized to the growing ends and the septum, where Rho1, Pck1p, and Bgs4p are known to function. Our results suggest that Rgf1p probably activates the Rho functions necessary for coordinating actin deposition with cell wall biosynthesis during bipolar growth, allowing the cells to remodel their wall without risk of rupture.