Regional levels of phosphatidylinositol 4,5-bisphosphate (PIP2), diacylglycerol (DG) and free fatty acids (FFA), involved in the signal transduction pathway of the excitatory neurotransmitter system, were measured after lateral fluid percussion (FP) brain injury in rats. At 5 min postinjury, tissue PIP2 concentrations were significantly reduced in the cortices and hippocampi of both ipsilateral and contralateral hemispheres. Only levels of stearic and arachidonic acids were substantially decreased in PIP2 in these regions of the brain. At the same time after injury, both DG and FFA were significantly increased in the cortices and hippocampi of both hemispheres. As was true for PIP2, only levels of stearic and arachidonic acids markedly changed in both DG and FFA in these regions of the brain. At 20 min postinjury, a significant decrease in PIP2 concentration and significant increases in levels of DG and FFA were observed only in the injured left cortex. In addition to the increases in stearic and arachidonic acids in FFA, increased amounts of palmitic and oleic acids were also found in the injured left cortex at 20 min after injury. These results suggest that the PIP2 signal transduction pathway is activated in the cortex and hippocampus at the onset of lateral FP brain injury and that the enhanced phospholipase C-catalyzed phosphodiestric breakdown of PIP2 is a major mechanism of liberation of FFA in these sites immediately after such injury.