The biochemical mechanisms involved in the activation and killing of tumor targets by large granular lymphocytes (LGL) have not yet been clearly defined. This laboratory has investigated these processes by analyzing the effects of protein kinase C (PKC) inhibitors (1-(5-isoquinolinesulfonyl)2-methyl-piperazine-dihydrochloride and retinol) on LGL cytotoxicity and IFN-gamma production. We now report that PKC inhibitors block the LGL functions of 1) NK activity, 2) IFN-gamma production, and 3) LAK activity induced by IL-2. Complete inhibition of cytotoxic activity occurs rapidly because only 2.5 h treatment of the LGL with the inhibitors was required. However, the inhibition of NK activity by the PKC inhibitors could be reversed by IL-2 or the synthetic diacylglycerol, L-gamma-1-oleyl-2-acetol-sn-3-glycerol (OAG), but not by IFN-alpha. The reversal of inhibition observed with OAG indicates that, in these studies, (1-(5-isoquinolinesulfonyl)2-methyl-piperazine-dihydrochloride is inhibiting PKC activity and not the activity of other cellular kinases. Furthermore, inhibition of LGL functional activity with PGE2 could not be reversed with OAG, supporting the contention that PG inhibition of NK activity is mediated by a pathway that does not directly involve PKC. These results indicate, in addition to IL-2-mediated events, that basal NK activity is under PKC regulatory control.