The Rho family of small GTPases has been implicated in the reorganization of actin cytoskeleton and subsequent morphological changes in various cells. Rnd2 is a member of the Rnd subfamily, comprising Rnd1, Rnd2, and Rnd3. In contrast to Rnd1 and Rnd3, displaying an antagonistic action for RhoA signaling, signaling pathways of Rnd2 are not well known. Here we have performed a yeast two-hybrid screen using Rnd2 as bait and identified a novel Rnd2 effector protein, predominantly expressed in neurons, including cortical and hippocampal neurons. We named it Pragmin (pragma of Rnd2). In in vivo and in vitro binding assays, Pragmin specifically binds to Rnd2 among the Rho family GTPases in a GTP-dependent manner. Rnd2-bound Pragmin significantly stimulates RhoA activity and induces cell contraction through RhoA and the Rho-kinase pathway in HeLa cells. In PC12 cells, expressing Pragmin inhibits nerve growth factor-induced neurite outgrowth in response to Rnd2, and knock-down of Pragmin by Pragmin-specific small interfering RNA enhances neurite elongation. Therefore, Rnd2 regulates neurite outgrowth by functioning as the RhoA activator through Pragmin, in contrast to Rnd1 and Rnd3 inhibiting RhoA signaling.