Guanine nucleotide exchange factors (GEFs) directly engage small GTPases to facilitate the exchange of bound GDP for GTP, leading to GTPase activation. Several recent crystal structures of GEFs in complex with Rho family GTPases highlight the conserved interactions and conformational alterations necessary for catalyzing exchange. In the present study, functional roles were defined for specific residues within Cdc42 implicated by the crystal structures as important for physiological exchange of guanine nucleotides within Rho GTPases. In particular, this study highlights the paramount importance of the phosphate-binding loop and interactions with the magnesium co-factor as critical for proper regulation of RhoGEF-catalyzed exchange. Other conformational alterations of the GTPases affecting interactions with the sugar and base of guanine nucleotides are also important but are secondary. Of particular note, substitution of alanine for cysteine at position 18 of Cdc42 leads to a fast cycling phenotype for Cdc42 with heightened affinity for RhoGEFs and produces a dominant negative form of Cdc42 capable of inhibiting RhoGEFs both in vitro and in vivo.