Phosphatidic acid (PA) is a cytokine in a variety of cell types, and an intermediary in cell activation. It is produced from membrane phospholipids by either lysophosphatidate acyl-CoA:acyltransferase (lyso-PA AT) or phospholipase D. Interleukin-1 (IL-1) stimulation of human mesangial cells (HMC) induced activation of lyso-PA AT, and synthesis of new PA species with significant increase in PA mass. These PA species were enriched in long-chain unsaturated acyl side chains (C18:1, C18:2, C20:5, and C22:6) in both the sn-2 and sn-1 positions, and stimulated the action of the lyso-PA AT as a positive feedback mechanism. Gas-liquid chromatography and mass spectrometry demonstrate that the acyl composition of phosphatidic acid does not resemble that of the major phospholipid fractions of this preparation and therefore is not the product of phospholipase D. The PA species were rapidly converted to 1,2-sn-diacylglycerols by phosphatidate phosphohydrolase, which also was activated by IL-1 via a separate mechanism involving a pertussis-sensitive G-protein. The activities of lyso-PA AT and phosphatidate phosphohydrolase were associated with plasma membrane enriched and refined microsomal fractions. IL-1 stimulation of a murine T cell (thymoma) line, EL-4, also caused stimulation of lyso-PA AT, resulting in PA formation. EL-4 mutants with defective IL-1 receptors did not demonstrate stimulation of lyso-PA AT, showing the necessity of intact IL-1 receptors for activation of this enzyme. We conclude that PA is a significant signaling intermediary for IL-1 via activation of lyso-PA AT and a G-protein, which activates phosphatidate phosphohydrolase. This system suggests a novel mechanism whereby a low intensity signal may be translated into cellular activation.