Defective tissue perfusion and nitric oxide production and altered myo-inositol metabolism and protein kinase C activation have been invoked in the pathogenesis of diabetic complications including neuropathy. The precise cellular compartmentalization and mechanistic interrelationships of these abnormalities remain obscure, and nitric oxide possesses both neurotransmitter and vasodilator activity. Therefore the effects of ambient glucose and myo-inositol on nitric oxide-dependent cGMP production and protein kinase C activity were studied in SH-SY5Y human neuroblastoma cells, a cell culture model for peripheral cholinergic neurons. D-Glucose lowered cellular myo-inositol content, phosphatidylinositol synthesis, and phosphorylation of an endogenous protein kinase C substrate, and specifically reduced nitric oxide-dependent cGMP production a time- and dose-dependent manner with an apparent IC50 of approximately 30 mM. The near maximal decrease in cGMP induced by 50 mM D-glucose was corrected by the addition of protein kinase C agonists or 500 microM myo-inositol to the culture medium, and was reproduced by protein kinase C inhibition or downregulation, or by myo-inositol deficient medium. Sodium nitroprusside increased cGMP in a dose-dependent fashion, with low concentrations (1 microM) counteracting the effects of 50 mM D-glucose or protein kinase C inhibition. The demonstration that elevated D-glucose diminishes basal nitric oxide-dependent cGMP production by myo-inositol depletion and protein kinase C inhibition in peripheral cholinergic neurons provides a potential metabolic basis for impaired nitric oxide production, nerve blood flow, and nerve impulse conduction in diabetes.