The cAMP-PKA cascade is a recognized signaling pathway important in inhibition of inflammatory injury events such as endothelial permeability and leucocyte trafficking, and a critical target of regulation is believed to be inhibition of Rho proteins. Here, we hypothesize that PKA directly phosphorylates GDI (GTP Dissociation Inhibitor) to negatively regulate Rho activity. Amino acid analysis of human GDI showed two potential PKA phosphorylation motifs, Ser¹⁷⁴ and Thr¹⁸². Using in vitro kinase assay and mass spectrometry, we found that the purified PKA catalytic subunit phosphorylated GDI-GST fusion protein and PKA motif-containing GDI peptide at Ser¹⁷⁴, but not Thr¹⁸². Transfection of COS 7 cells with mutated full-length GDI at Ser¹⁷⁴ to Ala¹⁷⁴ (GDI-Ser^174A) abrogated the ability of cAMP to phosphorylate GDI. However, mutation of Thr¹⁸² to Ala¹⁸² (GDI-Thr^182A) did not, and cAMP increased phosphorylation of GDI to a similar extent as wtGDI transfectants. The mutant GDI-Ser^174A, but not GDI-Thr^182A, was unable to prevent cAMP-mediated inhibition of Rho-dependent SRE reporter activity. Further, the mutant GDI-Ser^174A was unable to prevent the thrombin-induced RhoA activation. Co-precipitation studies indicated that neither mutation of the PKA consensus sites nor phosphorylation alter GDI binding with RhoA, suggesting that phosphorylation of Ser¹⁷⁴ regulated pre-formed GDI-RhoA complexes. The findings provide strong support that the selective phosphorylation at Ser¹⁷⁴ by PKA is a signaling pathway in the negative regulation of RhoA activity, and therefore could be a potential protective mechanism for inflammatory injury.