The Ras/mitogen-activated protein kinase (MAPK) pathway plays a critical role in transducing mitogenic signals from receptor tyrosine kinases. Loss-of-function mutations in one feedback regulator of Ras/MAPK signaling, SPRED1 (Sprouty-related protein with an EVH1 domain), cause Legius syndrome, an autosomal dominant human disorder that resembles Neurofibromatosis-1 (NF1). Spred1 functions as a negative regulator of the Ras/MAPK pathway; however, the underlying molecular mechanism is poorly understood. Here we show that neurofibromin, the NF1 gene product, is a Spred1-interacting protein that is necessary for Spred1's inhibitory function. We show that Spred1 binding induces the plasma membrane localization of NF1, which subsequently down-regulates Ras-GTP levels. This novel mechanism for the regulation of neurofibromin provides a molecular bridge for understanding the overlapping pathophysiology of NF1 and Legius syndrome.