Targeted disruption of both alleles of mouse sos1, which encodes a Ras-specific exchange factor, conferred mid-gestational embryonic lethality that was secondary to impaired placental development and was associated with very low placental ERK activity. The trophoblastic layers of sos1(-/-) embryos were poorly developed, correlating with high sos1 expression in wild-type trophoblasts. A sos1(-/-) cell line, which expressed readily detectable levels of the closely related Sos2 protein, formed complexes between Sos2, epidermal growth factor receptor (EGFR) and Shc efficiently, gave normal Ras.GTP and ERK responses when treated with EGF for < or =10 min and was transformed readily by activated Ras. However, the sos1(-/-) cells were resistant to transformation by v-Src or by overexpressed EGFR and continuous EGF treatment, unlike sos1(+/-) or wild-type cells. This correlated with Sos2 binding less efficiently than Sos1 to EGFR and Shc in cells treated with EGF for > or =90 min or to v-Src and Shc in v-Src-expressing cells, and with less ERK activity. We conclude that Sos1 participates in both short- and long-term signaling, while Sos2-dependent signals are predominantly short-term.