The alpha subunit of p21(RAS) farnesyltransferase (FNTA), which is also shared by geranylgeranyltransferase, was isolated as a specific cytoplasmic interactor of the transforming growth factor-beta (TGF-beta) and activin type I receptors with the use of the yeast two-hybrid system. FNTA interacts specifically with ligand-free TGF-beta type l receptor but is phosphorylated and released upon ligand binding. Furthermore, the release is dependent on the kinase activity of the TGF-beta type II receptor. Thus, the growth inhibitory and differentiative pathways activated by TGF-beta and activin involve novel mechanisms of serine-threonine receptor phosphorylation-dependent release of cytoplasmic interactors and regulation of the activation of small G proteins, such as p21(RAS).