RhoGAP proteins are key regulators of Rho family GTPases and influence a variety of cellular processes, including cell migration, adhesion, and cytokinesis. These GTPase activating proteins (GAPs) downregulate Rho signaling by binding and enhancing the intrinsic GTPase activity of Rho proteins. Deleted in liver cancer 1 (DLC1) is a tumor suppressor and ubiquitously expressed RhoGAP protein; its activity is regulated in part by binding p120RasGAP, a GAP protein for the Ras GTPases. In this study, we report the co-crystal structure of the p120RasGAP SH3 domain bound directly to DLC1 RhoGAP, at a site partially overlapping the RhoA binding site and impinging on the catalytic arginine finger. We demonstrate biochemically that mutation of this interface relieves inhibition of RhoGAP activity by the SH3 domain. These results reveal the mechanism for inhibition of DLC1 RhoGAP activity by p120RasGAP and demonstrate the molecular basis for direct SH3 domain modulation of GAP activity.