1. The effect of magnesium and dl-propranolol on phosphatidate phosphohydrolase (PAPase) and diacylglycerol lipase (DGL) activities in isolated rod outer segments (ROS) and of the former on subcellular fractions from bovine retina was investigated. 2. Mg(2+)-independent PAPase activity was found in ROS, whereas in the other subcellular fractions PAPase activities both dependent on and independent of Mg2+ were detected. 3. The membrane-bound PAPase activity was stimulated at low concentrations of Mg2+ and inhibited at higher concentrations. The soluble activity was always stimulated by the ion. 4. dl-Propranolol (1000 microM) exerted a slight stimulatory effect on PAPase in ROS whereas total PAPase activity of microsomal fraction was not affected. 5. Mg2+ (0.2 mM) stimulated DGL activity (30%) whereas it was inhibited at higher concentration. 6. DGL lipase activities, both dependent on and independent of Mg2+, were detected in subcellular fractions of bovine retina. 7. DGL properties in ROS are also described.