The binding of a variety of agonists to their receptors leads to the breakdown of membrane phospholipids and the formation of intracellular second messengers. Hydrolysis of inositol phospholipids by phospholipase C results in the formation of two second messengers, inositol-1,4,5-trisphosphate which mobilizes intracellular calcium and the neutral lipid diacylglycerol (DAG) which binds to and activates protein kinase C (PKC). PKC is actually a family of homologous serine/threonine protein kinases which play a central role in regulation of growth, differentiation and secretion reactions in a variety of cell types. In addition to these feedforward role of PKC, it is thought to play an important feedback role, regulating early events in signal transduction. To explore these feedback functions we have examined the effect of PKC inhibitors on second messenger formation in thrombin-stimulated human platelets (a rapidly responding system) and the effect of PKC overexpression on second messenger formation and mitogenesis in rat fibroblasts (a system where sustained signaling occurs). Treatment of platelets with inhibitors of PKC potentiates DAG mass formation in response to thrombin while prior activation of PKC with phorbol esters blocks DAG mass formation, consistent with PKC playing a negative feedback role, inhibiting inositol phospholipid breakdown. DAG can also be formed by the sequential hydrolysis of phosphatidylcholine by phospholipase D and phosphatidic acid phosphohydrolase. This is a minor reaction in the rapidly responding platelet system, but may play a role in sustained signaling events. We have found that fibroblasts which overexpress the β1 isozyme of PKC display greatly enhanced DAG formation and phospholipase D activation in response to phorbol ester treatment. Upon stimulation of fibroblasts with thrombin, phospholipase D activation is also enhanced by PKC overexpression while formation of inositol phosphates is suppressed. These data suggest that PKC may act as a switch, terminating inositol phospholipid hydrolysis and activating the hydrolysis of phosphatidylcholine. Furthermore, we have observed a strong correlation between activation of phospholipase D and mitogenesis, suggesting an important role for this enzyme in long-term cellular responses to activation.