Covalent modification with lipid can target cytosolic proteins to biological membranes. With intrinsic membrane proteins, the role of acylation can be elusive. Herein, we describe covalent lipid modification of an integral membrane glycosylphosphatidylinositol-specific phospholipase C (GPI-PLC) from the kinetoplastid Trypanosoma brucei. Myristic acid was detected on cysteine residue(s) (i.e. thiomyristoylation). Thiomyristoylation occurred both co- and post-translationally. Acylated GPI-PLC was active against variant surface glycoprotein (VSG). The half-life of fatty acid on GPI-PLC was 45 min, signifying the dynamic nature of the modification. Deacylation in vitro decreased activity of GPI-PLC 18-30-fold. Thioacylation, from kinetic analysis, activated GPI-PLC by accelerating the conversion of a GPI-PLC.VSG complex to product. Reversible thioacylation is a novel mechanism for regulating the activity of a phospholipase C.