The binding and hydrolysis of guanosine triphosphate (GTP) by the small GTP-binding protein Sar1p is required to form transport vesicles from the endoplasmic reticulum (ER) in Saccharomyces cerevisiae. Experiments revealed that an interaction between Sar1p and the Sec23p subunit of an oligomeric protein is also required for vesicle budding. The isolated Sec23p subunit and the oligomeric complex stimulated guanosine triphosphatase (GTPase) activity of Sar1p 10- to 15-fold but did not activate two other small GTP-binding proteins involved in vesicle traffic (Ypt1p and ARF). Activation of GTPase was inhibited by an antibody to Sec23p but not by an antibody that inhibits the budding activity of the other subunit of the Sec23p complex. Also, activation was thermolabile in pure samples of Sec23p that were isolated from two independent sec23 mutant strains. It appears that Sec23p represents a new class of GTPase-activating protein because its sequence shows no similarity to any known member of this family.