Cytotoxicity is a key function of natural killer (NK) and T cells; yet the molecular mechanism is unclear. We have biological, biochemical and molecular evidence to demonstrate that phosphatidyl-inositol (PI) 3-kinase is critical for direct NK lysis of tumor cells, via control of intracellular granule movement. Tumor cell engagement rapidly activated PI 3-kinase in NK cells within 5 min, as demonstrated by p85 subunit tyrosine phosphorylation and its ability to generate phosphatidylinositol 3-phosphate, PI(3)P, from PI. Wortmannin and LY294002 effectively inhibited NK cells to lyse 51Cr-labeled tumor cells at the same doses that blocked PI-phosphorylating function in tumor-activated NK cells. Immunostaining demonstrated that tumor engagement for only 5 min mobilized perforin and granzyme B from NK cells unidirectionally towards the target, and prior treatment of NK cells with either PI 3-kinase inhibitor effectively stopped this intracellular polarization. Lastly, ectopic expression of dominant-negative p85 or p110 mutant markedly suppressed NK lytic capacity. These results taken together demonstrate that PI 3-kinase may control NK lytic function via granule polarization towards the contacted target cell.