The tumor suppressor adenomatous polyposis coli (APC) is mutated in sporadic and familial colorectal tumors. APC interacts with the Rac1-specific guanine–nucleotide exchange factor (GEF) Asef, which contains an APC-binding region (ABR) in addition to Dbl homology (DH), Pleckstrin (PH) and Src homology 3 (SH3) domains. APC stimulates the GEF activity of Asef, and thereby regulates cell adhesion and migration. Here, we have identified a second Asef, termed Asef2, that shows significant structural and functional similarities to Asef. We found that both the N-terminal ABR and SH3 domains of Asef2 are responsible for its interaction with APC. When expressed in HeLa cells, a mutant Asef2 lacking the ABR and SH3 domains, Asef2-ΔABR/SH3, induced increases in the levels of the active forms of Rac1 and Cdc42. Full-length Asef2 also showed this activity when co-transfected with truncated mutant APC expressed in colorectal tumor cells. Consistent with this, either Asef2-ΔABR/SH3 or Asef2 plus truncated mutant APC stimulated lamellipodia formation in MDCK cells and filopodia formation in HeLa cells. Furthermore, RNA interference experiments showed that Asef2 is required for migration of colorectal tumor cells expressing truncated APC. These results suggest that similar to Asef, Asef2 plays an important role in cell migration, and that Asef2 activated by truncated mutant APC is required for aberrant migration of colorectal tumor cells.