1. Mesophyll chloroplasts of the C4 plant Digitaria sanguinalis contain endogenous phosphoenolpyruvate which appears to distribute across the envelope according to the existing pH gradient. The phosphoenolpyruvate remaining in the stroma can be rapidly released by external inorganic phosphate or 3-phosphoglycerate while external pyruvate did not affect the distribution. 2. Phosphoenolpyruvate (PEP) was a competitive inhibitor (Ki (PEP) = 450 micrometer) of 32Pi uptake (Km(Pi)=200 micrometer) by chloroplasts in the dark and also reduced the steady-state internal concentration of 32Pi, which is consistent with phosphate and phosphoenolpyruvate sharing a common carrier. 3. Phosphoenolpyruvate formation by chloroplasts in the light in the presence of pyruvate but in the absence of inorganic phosphate was slow and the concentration ratio of phosphoenolpyruvate (internal/external) was high. Addition of 0.1 mM phosphate induced a high rate of phosphoenolpyruvate formation and the concentration ratio (internal/external) decreased 15-fold. It is proposed that external phosphate is required both for phosphoenolpyruvate formation and efflux from the chloroplast.