BACKGROUND: RhoGDI proteins are important regulators of the small GTPase Rac, because they shuttle Rac from the cytoplasm to membranes and also protect Rac from activation, deactivation and degradation. How the binding and release of Rac from RhoGDI is regulated is not precisely understood. RESULTS: We report that the non-receptor tyrosine kinase Fer is able to phosphorylate RhoGDIα and form a direct protein complex with it. This interaction is mediated by the C-terminal end of RhoGDIα. Activation of Fer by reactive oxygen species caused increased phosphorylation of RhoGDIα and pervanadate treatment further augmented this. Tyrosine phosphorylation of RhoGDIα by Fer prevented subsequent binding of Rac to RhoGDIα, but once a RhoGDIα-Rac complex was formed, the Fer kinase was not able to cause Rac release through tyrosine phosphorylation of preformed RhoGDIα-Rac complexes. CONCLUSIONS: These results identify tyrosine phosphorylation of RhoGDIα by Fer as a mechanism to regulate binding of RhoGDIα to Rac.