The distribution of acetylcholine receptors (AChRs) within and around the neuromuscular junction changes dramatically during the first postnatal weeks, a period during which polyneuronal innervation is eliminated. We reported previously that protein kinase C (PKC) activation accelerates postnatal synapse loss. Because of the close relationship between axonal retraction and AChR cluster dispersal, we hypothesize that PKC can modulate morphological maturation changes of the AChR clusters in the postsynaptic membrane during neonatal axonal reduction. We applied substances affecting PKC activity to the neonatal rat levator auris longus muscle in vivo. Muscles were then stained immunohistochemically to detect both AChRs and axons. We found that, during the first postnatal days of normal development, substantial axonal loss preceded the formation of areas in synaptic sites that were free of AChRs, implying that axonal loss could occur independently of changes in AChR cluster organization. Nevertheless, there was a close relationship between axonal loss and AChR organization; PKC modulates both, although differently. Block of PKC activity with calphostin C prevented both AChR loss and axonal loss between postnatal days 4 and 6. PKC may act primarily to influence AChR clusters and not axons, insofar as phorbol ester activation of PKC accelerated changes in receptor aggregates but produced relatively little axon loss.