Rho-GDP dissociation inhibitors (Rho-GDI) are repressors of Rho-type monomeric GTPases that control fundamental cellular processes, such as cytoskeletal arrangement, vesicle trafficking, and polarized growth. We identified and altered the expression of the gene encoding a Rho-GDI homolog in the human fungal pathogen Cryptococcus neoformans and investigated its impact on pathogenicity in animal models of cryptococcosis. Consistent with its predicted function to inhibit and sequester Rho-type GTPases, overexpression of RDI1 results in cytosolic localization of Cdc42. Likely as a result of this finding, RDI1-overexpressing strains exhibited altered morphology compared to that of the wild type, with apparent defects in maintaining proper cell polarity and cytokinesis. RDI1 deletion resulted in increased vacuole size in tissue culture medium and aberrant cell morphology at neutral pH. Maintenance of normal cell morphology is vital for C. neoformans pathogenicity. Accordingly, the rdi1Delta mutant strain also showed reduced intracellular survival in macrophages and severe attenuation of virulence in two murine models of cryptococcosis. This reduction in virulence of the rdi1Delta mutant occurs in the absence of major growth defects in rich medium and with classical virulence-associated phenotypes.