RCC2 (also known as TD60) is a highly conserved protein involved in prognosis in colorectal cancer. However, its relationship with tumor development is less understood. Here we demonstrate a signaling pathway defining regulation of RCC2 and its functions in tumor progression. We report that p53 is a transcriptional regulator of RCC2 that acts through its binding to a palindromic motif in the RCC2 promoter. RCC2 physically interacts and deactivates a small GTPase Rac1 that is known to be involved in metastasis. We solved a high-resolution crystal structure of RCC2 and revealed one RCC1-like domain with a unique β-hairpin that is requisite for RCC2 interaction with Rac1. p53 or RCC2 deficiency leads to activation of Rac1 and deterioration of extracellular matrix sensing (haptotaxis) of surface-bound gradients. Ectopic expression of RCC2 restores directional migration in p53-null cells. Our results demonstrate that p53 and RCC2 signaling is important for regulation of cell migration and suppression of metastasis. We propose that the p53/RCC2/Rac1 axis is a potential target for cancer therapy.