The serum response element (SRE) is a promoter element essential for transcriptional activation of immediate early genes, such as c-fos and early growth response-1, by mitogenic signals. Several transcription factors bind the SRE, including the serum response factor (SRF), the ternary complex factor, and the CCAAT/enhancer-binding protein beta (C/EBPbeta). The C/EBPbeta mRNA encodes three translation products of 38, 35, and 20 kDa. p35-C/EBPbeta activates transcription of the SRE in an SRF-dependent fashion, whereas p20-C/EBPbeta, which initiates at an internal in-frame methionine, lacks a transactivation domain and inhibits transcription. We show that SRF and C/EBPbeta interact in vivo through the DNA binding domain of SRF and the C terminus of C/EBPbeta common to p35/38 and p20. Therefore, like the ternary complex factor, C/EBPbeta may be recruited to the SRE not only by binding to the DNA, which is not a high affinity site, but also by protein-protein interactions with SRF. Strikingly, in both the mammalian two-hybrid assay and in vivo coimmunoprecipitations, the association of SRF and p35-C/EBPbeta but not p20-C/EBPbeta is dramatically stimulated by activated Ras. Furthermore, mutation of the threonine within a mitogen-activated protein kinase consensus motif in the C terminus of C/EBPbeta eliminates the response to Ras. These results suggest a new mechanism by which mitogenic signals may influence transcription activity of the SRE by selectively promoting protein-protein interactions between SRF and the transactivator p35-C/EBPbeta.