The new member of the Ras superfamily of G-proteins, Rheb, has been identified in rat and human, but its function has not been defined. We report here the identification of Rheb homologues in the budding yeast Saccharomyces cerevisiae (ScRheb) as well as in Schizosaccharomyces pombe, Drosophila melanogaster, zebrafish, and Ciona intestinalis. These proteins define a new class of G-proteins based on 1) their overall sequence similarity, 2) high conservation of their effector domain sequence, 3) presence of a unique arginine in their G1 box, and 4) presence of a conserved CAAX farnesylation motif. Characterization of an S. cerevisiae strain deficient in ScRheb showed that it is hypersensitive to growth inhibitory effects of canavanine and thialysine, which are analogues of arginine and lysine, respectively. Accordingly, the uptake of arginine and lysine was increased in the ScRheb-deficient strain. This increased arginine uptake requires the arginine-specific permease Can1p. The function of ScRheb is dependent on having an intact effector domain since mutations in the effector domain of ScRheb are incapable of complementing canavanine hypersensitivity of scrheb disruptant cells. Furthermore, the conserved arginine in the G1 box plays a role in the activity of ScRheb, as a mutation of this arginine to glycine significantly reduced the ability of ScRheb to complement canavanine hypersensitivity of ScRheb-deficient yeast. Finally, a mutation in the C-terminal CAAX farnesylation motif resulted in a loss of ScRheb function. This result, in combination with our finding that ScRheb is farnesylated, suggests that farnesylation plays a key role in ScRheb function. Our findings assign the regulation of arginine and lysine uptake as the first physiological function for this new farnesylated Ras superfamily G-protein.