Isolated rat liver cells maintained in suspension culture for 4 to 5 h synthesize the gluconeogenic cytosolic enzyme phosphoenolpyruvate carboxykinase at a rate approximately 5-fold lower than the in vivo hepatic rate. Glucagon rapidly re-induces phosphoenolpyruvate carboxykinase synthesis in such cells. The rate of enzyme synthesis doubles in 40 min and plateaus at a level 6- to 13-fold higher than in control cells 120 min after glucagon addition at maximal concentration. Consistent with the presumed role of cyclic AMP as a mediator of enzyme induction, the phosphodiesterase inhibitor 3-isobutyl-1-methylxanthine, added simultaneously with glucagon, shifts the hormone dose-response curve 2 log units to the left. Moreover, cyclic AMP supplied exogenously to the cells mimics the inductive effect of glucagon. Total cellular RNA isolated from hepatocytes induced by glucagon contains an increased level of mRNA coding for phosphoenolpyruvate carboxykinase, as determined by translational assay. The kinetics and extent of the rise in mRNA level are adequate to explain the stimulation of enzyme synthesis. Although glucagon on its own induces a build-up of phosphoenolpyruvate carboxykinase mRNA and a commensurate stimulation of enzyme synthesis, the glucagon induction is very markedly amplified when the cells are first preincubated with dexamethasone. The glucocorticoid by itself, however, does not have any substantial effect on the level of phosphoenolpyruvate carboxykinase mRNA or on the rate of enzyme synthesis. Its role can therefore be characterized as permissive.