Ect2, a Rho guanine nucleotide exchange factor (RhoGEF), is atypical among RhoGEFs in its predominantly nuclear localization in interphase cells. One current model suggests that Ect2 mislocalization drives cellular transformation by promoting aberrant activation of cytoplasmic Rho family GTPase substrates. However, in ovarian cancers, where Ect2 is both amplified and overexpressed at the mRNA level, we observed that the protein is highly expressed and predominantly nuclear and that nuclear but not cytoplasmic Ect2 increases with advanced disease. Knockdown of Ect2 in ovarian cancer cell lines impaired their anchorage-independent growth without affecting their growth on plastic. Restoration of Ect2 expression rescued the anchorage-independent growth defect, but not if either the DH catalytic domain or the nuclear localization sequences of Ect2 were mutated. These results suggested a novel mechanism whereby Ect2 could drive transformation in ovarian cancer cells by acting as a RhoGEF specifically within the nucleus. Interestingly, Ect2 had an intrinsically distinct GTPase specificity profile in the nucleus versus the cytoplasm. Nuclear Ect2 bound preferentially to Rac1, while cytoplasmic Ect2 bound to RhoA but not Rac. Consistent with nuclear activation of endogenous Rac, Ect2 overexpression was sufficient to recruit Rac effectors to the nucleus, a process that required a functional Ect2 catalytic domain. Furthermore, expression of active nuclearly targeted Rac1 rescued the defect in transformed growth caused by Ect2 knockdown. Our work suggests a novel mechanism of Ect2-driven transformation, identifies subcellular localization as a regulator of GEF specificity, and implicates activation of nuclear Rac1 in cellular transformation. © The Author(s) 2013.