cAMP stimulates proliferation in many cell types. For many years, cAMP-dependent protein kinase (PKA) represented the only known cAMP effector. PKA, however, does not fully mimic the action of cAMP, indicating the existence of a PKA-independent component. Since cAMP-mediated activation of the G-protein Rap1 and its phosphorylation by PKA are strictly required for the effects of cAMP on mitogenesis, we hypothesized that the Rap1 activator Epac might represent the PKAindependent factor. Here we report that Epac acts synergistically with PKA in cAMP-mediated mitogenesis. We have generated a new dominant negative Epac mutant that revealed that activation of Epac is required for thyroid-stimulating hormone or cAMP stimulation of DNA synthesis. We demonstrate that Epac's action on cAMP-mediated activation of Rap1 and cAMP-mediated mitogenesis depends on the subcellular localization of Epac via its DEP domain. Disruption of the DEP-dependent subcellular targeting of Epac abolished cAMP-Epac-mediated Rap1 activation and thyroid-stimulating hormone-mediated cell proliferation, indicating that an Epac-Rap-PKA signaling unit is critical for the mitogenic action of cAMP.cAMP stimulates proliferation in several model systems (1). Particularly in endocrine cells, in vitro and in vivo studies demonstrated a role for cAMP in mitogenesis (2), a concept further supported by the identification of mutant receptors and G-proteins causally linking constitutive cAMP signaling with hyperproliferative states (3, 4). For many years, PKA 2 represented the only known cAMP effector (5); however, although its activity is necessary, it is not sufficient for cAMP mitogenic action (6, 7). These studies indicated the existence of PKA independent effectors involved in cAMP-mediated proliferation.Epac (exchange protein activated by cAMP) is a new cAMPdependent, PKA-independent guanine nucleotide-exchange factor (GEF) for the small G-protein Rap (8,9). Newly developed cAMP analogs (10) capable of discriminating between Epac and PKA are starting to unravel Epac's role in diverse biological responses (11, 12). Epac's N-terminal regulatory domain includes a DEP module (Disheveled, Egl10, Pleckstrin) responsible for its membrane localization (13) and a cAMPbinding domain (CBD) that directly binds cAMP (K d ϳ 4 M) (13). The catalytic domain consists of a Ras exchange motif (REM), and the CDC25-like catalytic core, sufficient for GEF action (8). Biochemical (13-16) and crystallographic studies (17) unmasked a role for the regulatory domain in maintaining Epac in a basal autoinhibited state; deletion of its N terminus converted REM-cdc25-Epac to a constitutively active (cAMPindependent) Rap GEF. The addition of the N terminus in trans to the active C terminus was able to inhibit its GEF activity, and this inhibition could be relieved by cAMP. Mutation analysis indicated a role for the N terminus sequence 321 VLVLE 325 (as in Epac1) as part of this inhibitory domain, and accordingly, disruption of this domain by conversion of this sequence to 321 AAAAA 325...