Ras proteins undergo a series of posttranslational modifications prior to association with the cytoplasmic surface of the plasma membrane. The modification steps include farnesylation, proteolysis, methylesterification, and palmitoylation. A 4-amino acid residue motif known as the CaaX box (C is cysteine, a is generally aliphatic, and X is the carboxyl-terminal residue) is the sequence recognized by the prenyl transferase that initiates the modification pathway. As part of our studies to define the requirements for Ras membrane association, we directed mutagenesis to the yeast Ras2 protein CaaX box to assess the relative importance of prenylation, palmitoylation, and stretches of basic amino acids on the function of the protein. The wild type yeast Ras2 protein terminates in the sequence Cys-Cys-Ile-Ile-Ser. We have identified mutations that do not contain a CaaX box but still encode functional Ras proteins. These mutations replace the terminal serine of the CaaX box with the sequence -Lys-Leu-Ile-Lys-Arg-Lys. Three mutants have been analyzed in detail. Ras2(CCIIKLIKRK) functions at a level similar to wild type Ras2, whereas cells expressing only Ras2(SCIIKLIKRK) and Ras2(SSIIKLIKRK) forms of Ras2 protein grow more slowly at 30 degrees C. In addition, strains expressing only Ras2(SSIIKLIKRK) protein fail to grow at 37 degrees C. Replacement of the basic residues with neutral amino acids (Ras2(CCIISIIS)) completely abolishes their ability to support Ras-dependent growth. The extension mutants are not prenylated, but Ras2(CCIIKLIKRK) and Ras2(SCIIKLIKRK) are palmitoylated. These results demonstrate that a diverse set of carboxyl-terminal sequence motifs and posttranslational modifications lead to functional Ras proteins in yeast.