Lysophosphatidic acid (LPA) is a simple phospholipid that possesses hormone- and growth-factor-like properties. LPA initiates its action by inducing GTP-dependent phosphoinositide hydrolysis and inhibiting adenylate cyclase [van Corven, Groenink, Jalink, Eichholtz & Moolenaar (1989) Cell 59, 45-54]. Here we show that LPA stimulates rapid breakdown of phosphatidylcholine (PC) in Rat-1 fibroblasts. LPA-induced PC breakdown occurs through activation of phospholipase D (PLD), as measured by the formation of free choline and phosphatidic acid and by transphosphatidylation in the presence of butan-1-ol. LPA also stimulates generation of diacylglycerol, but there is no detectable formation of phosphocholine, suggesting that a PC-specific phospholipase C (PLC) is not involved. The response to LPA was compared with that to endothelin, a potent inducer of phospholipid hydrolysis but a poor mitogen for Rat-1 cells. Our results indicate that: (1) LPA is less efficient than endothelin in inducing phosphoinositide and PC breakdown; (2) LPA-induced PLD activation is short-lived, levelling off after 2 min, whereas the endothelin-stimulated increase in PLD activity persists for at least 1 h; (3) the effect of LPA on PLD, like that of endothelin, is blocked by long-term pretreatment of the cells with phorbol ester, suggesting that PLD activation occurs through a protein kinase C-dependent mechanism. Furthermore, our results support the notion that there is no simple causal relationship between the degree of agonist-induced phospholipid hydrolysis and the magnitude of the mitogenic response.