Involved in development of cell polarity during the cell division cycle, and essential for bud emergence. Affects signaling in the pheromone-response pathway through the STE20 protein kinase. Negatively regulated by the GTPase-activating proteins RGA1, BEM3, and BEM4. GTP + H2O = GDP + H(+) + phosphate Interacts with BEM4; the interaction is direct (PubMed:8754839). Interacts with AXL2 (PubMed:17460121). Interacts with RGA1 (PubMed:7498791). Belongs to the small GTPase superfamily. Rho family. CDC42 subfamily.