Vulval induction during Caenorhabditis elegans development is mediated by LET-23, a homolog of the mammalian epidermal growth factor receptor tyrosine kinase. The sli-1 gene is a negative regulator of LET-23 and is shown here to encode a protein similar to c-Cbl, a mammalian proto-oncoprotein. SLI-1 and c-Cbl share approximately 55 percent amino acid identity over a stretch of 390 residues, which includes a C3HC4 zinc-binding motif known as the RING finger, and multiple consensus binding sites for Src homology 3 (SH3) domains. SLI-1 and c-Cbl may define a new class of proteins that modify receptor tyrosine kinase-mediated signal transduction.