Protein kinase C-epsilon (PKC-epsilon) contains a putative actin binding motif that is unique to this individual member of the PKC gene family. We have used deletion mutagenesis to determine whether this hexapeptide motif is required for the physical association of PKC-epsilon and actin. Full-length recombinant PKC-epsilon, but not PKC-betaII, -delta, -eta, or -zeta, bound to filamentous actin in a phorbol ester-dependent manner. Deletion of PKC-epsilon amino acids 222-230, encompassing a putative actin binding motif, completely abrogated this binding activity. When NIH 3T3 cells overexpressing either PKC-epsilon or the deletion mutant of this isozyme were treated with phorbol ester only wild-type PKC-epsilon colocalized with actin in zones of cell adhesion. In binary reactions, it was possible to demonstrate that purified filamentous actin is capable of directly stimulating PKC-epsilon phosphotransferase activity. These and other findings support the hypothesis that a conformationally hidden actin binding motif in the PKC-epsilon sequence becomes exposed upon activation of this isozyme and functions as a dominant localization signal in NIH 3T3 fibroblasts. This protein-protein interaction is sufficient to maintain PKC-epsilon in a catalytically active conformation.