Phospholipase Cepsilon (PLCepsilon) has been suggested to transduce signals from small GTPases, but its biological function has not yet been clarified. Using astrocytes from PLCepsilon-deficient mice, we demonstrate that endogenous G protein-coupled receptors (GPCRs) for lysophosphatidic acid, sphingosine 1-phosphate, and thrombin regulate phosphoinositide hydrolysis primarily through PLCepsilon. Stimulation by lysophospholipids occurs through G(i), whereas thrombin activates PLC through Rho. Further studies reveal that PLCepsilon is required for thrombin- but not LPA-induced sustained ERK activation and DNA synthesis, providing a novel mechanism for GPCR and Rho signaling to cell proliferation. The requirement for PLCepsilon in this pathway can be explained by its role as a guanine nucleotide exchange factor for Rap1. Thus, PLCepsilon serves to transduce mitogenic signals through a mechanism distinct from its role in generation of PLC-derived second messengers.