The family of p21-activated protein kinases (PAKs) appear to be present in all organisms that have Cdc42-like GTPases. In mammalian cells, PAKs have been implicated in the activation of mitogen-activated protein kinase cascades, but there are no reported effects of these kinases on the cytoskeleton. Recently we have shown that a Drosophila PAK is enriched in the leading edge of embryonic epithelial cells undergoing dorsal closure (N. Harden, J. Lee, H.-Y. Loh, Y.-M. Ong, I. Tan, T. Leung, E. Manser, and L. Lim, Mol. Cell. Biol. 16:1896-1908, 1996), where it colocalizes with structures resembling focal complexes. We show here by transfection that in epithelial HeLa cells alpha-PAK is recruited from the cytoplasm to distinct focal complexes by both Cdc42(G12V) and Rac1(G12V), which themselves colocalize to these sites. By deletion analysis, the N terminus of PAK is shown to contain targeting sequences for focal adhesions which indicate that these complexes are the site of kinase function in vivo. Cdc42 and Rac1 cause alpha-PAK autophosphorylation and kinase activation. Mapping alpha-PAK autophosphorylation sites has allowed generation of a constitutively active kinase mutant. By fusing regions of Cdc42 to the C terminus of PAK, activated chimeras were also obtained. Plasmids encoding these different constitutively active alpha-PAKs caused loss of stress fibers when introduced into both HeLa cells and fibroblasts, which was similar to the effect of introducing Cdc42(G12V) or Rac1(G12V). Significantly dramatic losses of focal adhesions were also observed. These combined effects resulted in retraction of the cell periphery after plasmid microinjection. These data support our previous suggestions of a role for PAK downstream of both Cdc42 and Rac1 and indicate that PAK functions include the dissolution of stress fibers and reorganization of focal complexes.