Arap3 is a phosphoinositide (PI) 3 kinase effector that serves as a GTPase activating protein (GAP) for both Arf and Rho G-proteins. The protein has multiple pleckstrin homology (PH) domains that bind preferentially phosphatidyl-inositol-3,4,5-trisphosphate (PI(3,4,5,)P3) to induce translocation of Arap3 to the plasma membrane upon PI3K activation. Arap3 also contains a Ras association (RA) domain that interacts with the small G-protein Rap1 and a sterile alpha motif (SAM) domain of unknown function. In a yeast two-hybrid screen for new interaction partners of Arap3, we identified the PI 5'-phosphatase SHIP2 as an interaction partner of Arap3. The interaction between Arap3 and SHIP2 was observed with endogenous proteins and shown to be mediated by the SAM domain of Arap3 and SHIP2. In vitro, these two domains show specificity for a heterodimeric interaction. Since it was shown previously that Arap3 has a higher affinity for PI(3,4,5,)P3 than for PI(3,4)P2, we propose that the SAM domain of Arap3 can function to recruit a negative regulator of PI3K signaling into the effector complex.