THE mammalian shc gene encodes two overlapping, widely expressed proteins of 46 and 52K, with a carboxy-terminal SH2 domain that binds activated growth factor receptors, and a more amino-terminal glycine/proline-rich region 1. These shc gene products (Shc) are transforming when overexpressed in fibroblasts1. Shc proteins become phosphorylated on tyrosine in cells stimulated with a variety of growth factors1, and in cells transformed by v-src (ref. 2), suggesting that they are tyrosine kinase targets that control a mitogenic signalling pathway. Here we report that tyrosine-phosphorylated She proteins form a specific complex with a non-phosphorylated 23K polypeptide encoded by the grb2/sem-5 gene3,4. The grb2/sem-5 gene product itself contains an SH2 domain, which mediates binding to Shc, and is implicated in activation of the Ras guanine nucleotide-binding protein by tyrosine kinases in both Caenorhabditis elegans and mammalian cells3,4. Consistent with a role in signalling through Ras, shc overexpression induced Ras-dependent neurite outgrowth in PC 12 cells. These results suggest that She tyrosine phosphorylation can couple tyrosine kinases to Grb2/Sem-5, through formation of a Shc-Grb2/Sem-5 complex, and thereby regulate the mammalian Ras signalling pathway.