Generalized gradient approximations have been used to calculate the potential energy curves for six rare gas diatomic molecules. Several generalized gradient approximations are found to provide a good description of binding in these diatomic molecules and show a significant improvement over the local density approximation in the prediction of bond lengths and dissociation energies. It is shown here that the behavior of an exchange functional in the region of small density and large density gradient plays a very important role in the ability of the functional to describe this type of van der Waals attraction. (C) 1997 American Institute of Physics.