In mammalian cells, phospholipase D (PLD) and its product phosphatidic acid (PA) are involved in a number of signalling cascades, including cell proliferation, membrane trafficking and defence responses. In plant cells a signalling role for PLD and PA is also emerging. Plants have the extra ability to phosphorylate PA to produce diacylglycerol pyrophosphate (DGPP), a newly discovered phospholipid whose formation attenuates PA levels, but which could itself be a second messenger. Here we report that increases in PA and its conversion to DGPP are common stress responses to water deficit. Increases occur within minutes of treatment and are dependent on the level of stress. Part of the PA produced is due to PLD activity as measured by the in vivo transphosphatidylation of 1-butanol, and part is due to diacylglycerol kinase activity as monitored via 32P-PA formation in a differential labelling protocol. Increases in PA and DGPP are found not only in the green alga Chlamydomonas moewusii and cell-suspension cultures of tomato and alfalfa when subjected to hyperosmotic stress, but also in dehydrated leaves of the resurrection plant Craterostigma plantagineum. These results provide further evidence that PLD and PA play a role in plant signalling, and provide the first demonstration that DGPP is formed during physiological conditions that evoke PA synthesis.