Spatio-temporal activation of Rho GTPases is essential for their function in a variety of biological processes and is achieved in part by regulating the localization of their activators, the Rho guanine nucleotide exchange factors (RhoGEFs). In this study, we provide the first characterization of the full-length protein encoded by RhoGEF TEM4 and delineate its domain structure, catalytic activity, and subcellular localization. First, we determined that TEM4 can stimulate guanine nucleotide exchange on RhoA and the related RhoB and RhoC isoforms. Second, we determined that TEM4, like other Dbl RhoGEFs, contains a functional pleckstrin homology (PH) domain immediately C-terminal to the catalytic Dbl homology (DH) domain. Third, using immunofluorescence analysis, we showed that TEM4 localizes to the actin cytoskeleton through sequences in the N-terminus of TEM4 independently of the DH/PH domains. Using site-directed mutagenesis and deletion analysis, we identified a minimal region between residues 81 and 135 that binds directly to F-actin and has an ∼90-fold higher affinity for ATP-loaded F-actin. Finally, we demonstrated that a single point mutation (R130D) within full-length TEM4 abolishes actin binding and localization of TEM4 to the actin cytoskeleton, as well as dampens the in vivo activity of TEM4 towards RhoC. Taken together, our data demonstrate that TEM4 contains a novel actin binding domain and binding to actin is essential for TEM4 subcellular localization and activity. The unique subcellular localization of TEM4 suggests a spatially-restricted activity and expands the diversity of mechanisms by which RhoGEF function can be regulated.