We describe a novel human adapter molecule containing a pleckstrin homolgy (PH) domain at the N terminus that is closely related to human Grb2-associated binder 1, Gab1, and Drosophila daughter of sevenless. We designate this protein as Gab2. Northern blot analysis indicates that Gab2 is widely expressed and has an overlapping but distinctive expression pattern as compared with Gab1, with high levels of Gab2 mRNA detected in the heart, brain, placenta, spleen, ovary, peripheral blood leukocytes, and spinal cord. Upon tyrosine phosphorylation, Gab2 physically interacts with Shp2 tyrosine phosphatase and Grb2 adapter protein. Strikingly, Gab2 has an inhibitory effect on the activation of Elk-1-dependent transcription triggered by a dominant active Ras mutant (RasV12) or under growth factor stimulation, whereas Gab1 acts to potentiate slightly the Elk-1 activity in the same system. In contrast to the reciprocal effects of Gab1 and Gab2 in mediating Elk-1 induction, these two molecules have a similar function in extracellular signal-regulated kinase activation induced by either oncogenic Ras or growth factor stimulation. Taken together, these results argue that Gab1 and Gab2, two closely related PH-containing adapter proteins, might have distinct roles in coupling cytoplasmic-nuclear signal transduction. This is the first evidence that an intracellular molecule with a PH domain operates as a negative effector in signal relay to the regulation of gene expression.