RhoGDI2 is a suppressor of metastasis in human bladder cancer. Although diminished RhoGDI2 expression in tumors is associated with decreased patient survival, normal expression in some metastatic tumors led us to wonder whether other mechanisms regulate RhoGDI2 function. Protein interaction analysis identified Src as a novel RhoGDI2 interaction partner. Gene expression profiling and immunohistochemistry of human tumors revealed that Src levels diminish as a function of bladder cancer stage. In addition, diminished Src levels and RhoGDI2 levels appear mutually exclusive in individual tumors, indicating that both genes are likely involved in the same signaling pathway leading to metastasis suppression. Studies confirmed that activated Src kinase binds and phosphorylates RhoGDI2 in vitro and vivo. Mutagenesis revealed that Tyr-153 and, to a lesser degree, Tyr-24 were the primary Src phosphorylation sites. Phosphorylation decreased the amount of Rac1 in RhoGDI2 complexes and increased RhoGDI2 association with cell membranes. Stable expression of phosphomimetic Tyr-153 RhoGDI2 in metastatic human bladder cancer cell lines had no effect on primary tumor growth but suppressed metastasis more potently than WT RhoGDI2. These data suggest that phosphorylation by Src enhances RhoGDI2 metastasis suppression and that loss of Src relieves metastasis suppression in tumor cells that maintain RhoGDI2 expression. Our findings also suggest caution in using Src inhibitors in the hope of delaying progression in patients with bladder cancer.