The inositol lipid and phosphate binding properties and the cellular localization of phospholipase Cdelta(4) (PLCdelta(4)) and its isolated pleckstrin homology (PH) domain were analyzed in comparison with the similar features of the PLCdelta(1) protein. The isolated PH domains of both proteins showed plasma membrane localization when expressed in the form of a green fluorescent protein fusion construct in various cells, although a significantly lower proportion of the PLCdelta(4) PH domain was membrane-bound than in the case of PLCdelta(1)PH-GFP. Both PH domains selectively recognized phosphatidylinositol 4,5-bisphosphate (PI(4,5)P(2)), but a lower binding of PLCdelta(4)PH to lipid vesicles containing PI(4,5)P(2) was observed. Also, higher concentrations of inositol 1,4,5-trisphosphate (Ins(1,4,5)P(3)) were required to displace the PLCdelta(4)PH from the lipid vesicles, and a lower Ins(1,4,5)P(3) affinity of PLCdelta(4)PH was found in direct Ins(1,4,5)P(3) binding assays. In sharp contrast to the localization of its PH domain, the full-length PLCdelta(4) protein localized primarily to intracellular membranes mostly to the endoplasmic reticulum (ER). This ER localization was in striking contrast to the well documented PH domain-dependent plasma membrane localization of PLCdelta(1). A truncated PLCdelta(4) protein lacking the entire PH domain still showed the same ER localization as the full-length protein, indicating that the PH domain is not a critical determinant of the localization of this protein. Most important, the full-length PLCdelta(4) enzyme still showed binding to PI(4,5)P(2)-containing micelles, but Ins(1,4,5)P(3) was significantly less potent in displacing the enzyme from the lipid than with the PLCdelta(1) protein. These data suggest that although structurally related, PLCdelta(1) and PLCdelta(4) are probably differentially regulated in distinct cellular compartments by PI(4,5)P(2) and that the PH domain of PLCdelta(4) does not act as a localization signal.