Gangliosides were recently shown to bind to calmodulin (Higashi, H., Omori, A., and Yamagata, T. (1992) J. Biol. Chem. 267, 9831-9838). This prompted us to investigate the effects of gangliosides on the calmodulin-dependent enzyme, cyclic nucleotide phosphodiesterase. Several species of gangliosides competitively inhibited calmodulin-stimulated phosphodiesterase activity, with GD1b, GT1b, and GD1a being noted to do so particularly (group 1). GM1, GQ1b, and GM2 (group 2) were less inhibitory, and GM3, GM3(NeuGc), GalCer, sulfatide, GgOse4Cer, and oligosaccharide portions of inhibitory gangliosides showed no inhibition in accordance with the binding specificity of calmodulin to gangliosides. Trypsin-activated phosphodiesterase was inhibited by gangliosides with similar specificity, indicating interactions of gangliosides with the enzyme. Inhibition, however, was less than that of calmodulin-dependent activity by these compounds and, in both cases, was eliminated by excess calmodulin. In the absence of calmodulin, group 1 gangliosides at lower concentrations activated the intact enzyme but inhibited it over a certain range of increase in concentration. Ganglioside-dependent modulation of calmodulin-dependent phosphodiesterase activity is thus shown to be due to interactions of gangliosides with both calmodulin and the enzyme, and consequently, ganglioside-calmodulin binding is likely the mechanism for regulation of the enzyme.