Expression of the glycogen-targeting protein PTG promotes glycogen synthase activation and glycogen storage in various cell types. In this study, we tested the contribution of phosphorylase inactivation to the glycogenic action of PTG in hepatocytes by using a selective inhibitor of phosphorylase (CP-91149) that causes dephosphorylation of phosphorylase a and sequential activation of glycogen synthase. Similar to CP-91194, graded expression of PTG caused a concentration-dependent inactivation of phosphorylase and activation of glycogen synthase. The latter was partially counter-acted by the expression of muscle phosphorylase and was not additive with the activation by CP-91149, indicating that it is in part secondary to the inactivation of phosphorylase. PTG expression caused greater stimulation of glycogen synthesis and translocation of glycogen synthase than CP-91149, and the translocation of synthase could not be explained by accumulation of glycogen, supporting an additional role for glycogen synthase translocation in the glycogenic action of PTG. The effects of PTG expression on glycogen synthase and glycogen synthesis were additive with the effects of glucokinase expression, confirming the complementary roles of depletion of phosphorylase a (a negative modulator) and elevated glucose 6-phosphate (a positive modulator) in potentiating the activation of glycogen synthase. PTG expression mimicked the inactivation of phosphorylase caused by high glucose and counteracted the activation caused by glucagon. The latter suggests a possible additional role for PTG on phosphorylase kinase inactivation.