The effect of arachidonic acid on protein kinase C activity and insulin secretion in mouse islets was investigated. Arachidonic acid stimulated protein kinase C activity in islet cytosol and membrane fractions by substituting for phosphatidylserine. Stimulation by arachidonic acid was dependent on either Ca2+ or the phorbol ester 12-O-tetradecanoylphorbol 13-acetate, was potentiated by the combined addition of Ca(2+) + 12-O-tetradecanoylphorbol 13-acetate, and did not further increase protein kinase C activity in the presence of saturating concentrations of phosphatidylserine. Arachidonic acid stimulation of protein kinase C was prevented by binding of arachidonic acid to albumin. In the absence of extracellular Ca2+, exogenous arachidonic acid stimulated insulin secretion. Arachidonic acid-induced insulin secretion was not potentiated by 12-O-tetradecanoylphorbol 13-acetate and was not prevented by the protein kinase C inhibitor staurosporine, suggesting that arachidonic acid-induced insulin secretion may occur independently of protein kinase C activation. Arachidonic acid-induced insulin secretion in Ca(2+)-free medium was on the other hand potentiated by addition of extracellular Ca2+. Stimulation of insulin secretion by exogenous arachidonic acid was associated with inactivation of protein kinase C. Inactivation of protein kinase C was also observed in islet homogenate after pre-incubation with arachidonic acid. Arachidonic acid-induced protein kinase C inactivation in islet homogenate was prevented by albumin or MgATP. Inactivation by arachidonic acid in intact islets was, however, not produced during enzyme isolation and was not prevented by inclusion of albumin or MgATP during preparation of protein kinase C extracts.(ABSTRACT TRUNCATED AT 250 WORDS)