In contrast to the CDC42 homologues of Saccharomyces cerevisiae and Schizosaccharomyces pombe, the WdCDC42 gene in the human pathogenic fungus Wangiella (Exophiala) dermatitidis was found to be nonessential for cell viability. Expression of the constitutively active allele wdcdc42(G14V) at 37 degrees C induced nonpolarized growth that led to cell enlargement and multiple nucleation. The swollen cells subsequently converted into planate divided bicellular forms or multiply septated sclerotic bodies in post-log phase, when the G14V-altered protein was diminished. The wdcdc42(G14V) mutation also strongly repressed filamentous growth both in the wild-type strain and in the temperature-sensitive hyphal-form mutant Hf1. In contrast, overexpression of the dominant negative alleles wdcdc42(T19N) and wdcdc42(D120A) had no obvious effect on fungal-cell polarization. These results suggested that WdCdc42p plays a unique regulatory role in cellular morphogenesis in W. dermatitidis. Activation of this protein in response to extracellular or intracellular signals seems to commit its yeast-like cells to a phenotype transition that produces sclerotic bodies while repressing hyphal development.