This study investigates the problem of sliding frictional contact between a laterally graded elastic medium and a rigid circular stamp. Analytical and computational methods are developed to evaluate the contact stresses. In the analytical formulation, spatial variation in the shear modulus of the graded medium is represented by an exponential function, and Poisson's ratio is taken as a constant. Coulomb's dry friction law is assumed to hold within the contact area. The two-dimensional plane elasticity problem is formulated utilizing Fourier transforms, and the resulting Cauchy-type singular integral equation of the second type is solved by applying an expansion-collocation technique. The finite element method is used in the computational analysis of the contact problem. In the finite element model, continuous variation of the shear modulus is taken into account by specifying this property at the centroid of each finite element. The finite element-based solution procedure is verified by making comparisons to the results obtained through the analytical method. Numerical results generated for the laterally graded medium with an exponential variation in the shear modulus illustrate the influences of lateral gradation and coefficient of friction upon the contact stress distributions. The capability of the proposed finite element method is further demonstrated by providing numerical results for a laterally graded medium whose shear modulus is represented by a power function.