Accumulating evidence suggests that p21(Cip1) located in the cytoplasm might play a role in promoting transformation and tumor progression. Here we show that oncogenic H-RasV12 contributes to the loss of actin stress fibers by inducing cytoplasmic localization of p21(Cip1), which uncouples Rho-GTP from stress fiber formation by inhibiting Rho kinase (ROCK). Concomitant with the loss of stress fibers in Ras-transformed cells, there is a decrease in the phosphorylation level of cofilin, which is indicative of a compromised ROCK/LIMK/ cofilin pathway. Inhibition of MEK in Ras-transformed NIH3T3 results in restoration of actin stress fibers accompanied by a loss of cytoplasmic p21(Cip1), and increased phosphorylation of cofilin. Ectopic expression of cytoplasmic but not nuclear p21(Cip1) in Ras-transformed cells was effective in preventing stress fibers from being restored upon MEK inhibition and inhibited phosphorylation of cofilin. p21(Cip1) was also found to form a complex with ROCK in Ras-transformed cells in vivo. Furthermore, inhibition of the PI 3-kinase pathway resulted in loss of p21(Cip1) expression accompanied by restoration of phosphocofilin, which was not accompanied by stress fiber formation. These results suggest that restoration of cofilin phosphorylation in Ras- transformed cells is necessary but not sufficient for stress fiber formation. Our findings define a novel mechanism for coupling cytoplasmic p21(Cip1) to the control of actin polymerization by compromising the Rho/ ROCK/ LIMK/ cofilin pathway by oncogenic Ras. These studies suggest that localization of p21(Cip1) to the cytoplasm in transformed cells contributes to pathways that favor not only cell proliferation, but also cell motility thereby contributing to invasion and metastasis.