Ha-Ras undergoes post-translational modifications (including attachment of farnesyl and palmitate) that culminate in localization of the protein to the plasma membrane. Because palmitate is not attached without prior farnesyl addition, the distinct contributions of the two lipid modifications to membrane attachment or biological activity have been difficult to examine. To test if palmitate is able to support these crucial functions on its own, novel C-terminal mutants of Ha-Ras were constructed, retaining the natural sites for palmitoylation, but replacing the C-terminal residue of the CAAX signal for prenylation with six lysines. Both the Ext61L and ExtWT proteins were modified in a dynamic fashion by palmitate, without being farnesylated; bound to membranes modestly (40% as well as native Ha-Ras); and retained appropriate GTP binding properties. Ext61L caused potent transformation of NIH 3T3 cells and, unexpectedly, an exaggerated differentiation of PC12 cells. Ext61L with the six lysines but lacking palmitates was inactive. Thus, farnesyl is not needed as a signal for palmitate attachment or removal, and a combination of transient palmitate modification and basic residues can support Ha-Ras membrane binding and two quite different biological functions. The roles of palmitate can therefore be independent of and distinct from those of farnesyl. Reciprocally, if membrane association can be sustained largely through palmitates, farnesyl is freed to interact with other proteins.