Addition of elicitor, cell wall fragments of the fungus Phytophthora parasitica, to tobacco cell suspension cultures (Nicotiana tabacum) resulted in the rapid synthesis and secretion of large amounts of antibiotic sesquiterpenoids. Pulse-labeling experiments with [(14)C]acetate and [(3)H] mevalonate demonstrated that the induction of sesquiterpenoid biosynthesis, maximal by 6 to 9 hours after elicitor addition to the cell cultures, was paralleled by a rapid and large decline in the incorporation rate of radioactivity into sterols. Consequently, sterol accumulation was also inhibited upon addition of elicitor to the cell cultures. Sesquiterpene cyclase activity was absent from control cell cultures but induced to a maximum within 10 hours of elicitor addition to the cell cultures. The cyclase activity remained elevated for an additional 30 hours before declining. In contrast, squalene synthetase activity was suppressed to less than 15% of that found in control cells within 7 hours of elicitor addition. Our results suggest that the channeling of isoprenoid intermediates, and especially farnesyl diphosphate, into sesquiterpenoids occurred by a coordinated increase in the sesquiterpene cyclase and a decrease in the squalene synthetase enzyme activities. A reexamination of the data pertaining to the transient induction of 3-hydroxy-3-methylglutaryl coenzyme A reductase activity (EC 1.1.1.34) in elicitor-treated cells suggested that, while the reductase activity was necessary for sesquiterpenoid biosynthesis, it functioned more to maintain a sufficient level of intermediates between mevalonate and farnesyl diphosphate rather than as a rate limiting step controlling the synthesis rate of any one class of isoprenoids.