The 90-kDa heat shock protein (Hsp90), the target of the ansamycin class of anti-cancer drugs, is required for the conformational activation of a specific group of signal transducers, including Raf-1. In this report we have identified a 75-kDa Raf-associated protein as Hsp90N, a novel member of the Hsp90 family. Intriguingly, the ansamycin-binding domain is replaced in Hsp90N by a much shorter, hydrophobic sequence, preceded by a putative myristylation signal. We demonstrate that, although much less abundant, Hsp90N binds Raf with a higher affinity than Hsp90. In sharp contrast to Hsp90, Hsp90N does not associate with p50 cdc37 , the Hsp90 kinase cofactor. Hsp90N was found to activate Raf in transiently transfected cells, while Rat F111 fibroblasts stably transfected with Hsp90N exhibited elevated activity of the Raf and downstream ERK kinases. This may be due to Raf binding to myristylated Hsp90N, followed by Raf translocation to the membrane. To examine whether Hsp90N could therefore substitute for Ras in Raf recruitment to the cell membrane, Hsp90N was transfected in c-Ras-deficient, 10T 1 ⁄2-derived preadipocytes. Our results indicate that, as shown before for activated Ras or Raf, the introduction of even low levels of Hsp90N through transfection in c-Ras-deficient preadipocytes causes a dramatic block of differentiation. Higher levels of Hsp90N expression resulted in neoplastic transformation, including interruption of gap junctional, intercellular communication, and anchorage-independent proliferation. These results indicate that the observed activation of Raf by Hsp90N has a profound biological effect, which is largely c-Ras-independent. With the recent finding that p50 cdc37 is tumorigenic in transgenic mice, these results reinforce the intriguing observation that the family of heat shock proteins represents a novel class of molecules with oncogenic potential.