The glycerophosphoinositols are diffusible phosphoinositide metabolites reported to modulate actin dynamics and tumour cell spreading. In particular, the membrane permeant glycerophosphoinositol 4-phosphate (GroPIns4P) has been shown to act at the level of the small GTPase Rac1, to induce the rapid formation of membrane ruffles. Here, we have investigated the signalling cascade involved in this process, and show that it is initiated by the activation of Src kinase. In NIH3T3 cells, exogenous addition of GroPIns4P induces activation and translocation of Rac1 and its exchange factor TIAM1 to the plasma membrane; in addition, in in-vitro assays, GroPIns4P favours the formation of a protein complex that includes Rac1 and TIAM1. Neither of these processes involves direct actions of GroPIns4P on these proteins. Thus, through the use of specific inhibitors of tyrosine kinases and phospholipase C (and by direct evaluation of kinase activities and inositol 1,4,5-trisphosphate production), we show that GroPIns4P activates Src, and as a consequence, phospholipase Cgamma and Ca(2+)/calmodulin kinase II, the last of which directly phosphorylates TIAM1 and leads to TIAM1/Rac1-dependent ruffle formation.