Sustained activation of protein kinase C (PKC) isoenzymes alpha and betaII leads to their translocation to a perinuclear region and to the formation of the pericentrion, a PKC-dependent subset of recycling endosomes. In MCF-7 human breast cancer cells, the action of the PKC activator 4beta-phorbol-12-myristate-13-acetate (PMA) evokes ceramide formation, which in turn prevents PKCalpha/betaII translocation to the pericentrion. In this study we investigated the mechanisms by which ceramide negatively regulates this translocation of PKCalpha/betaII. Upon PMA treatment, HEK-293 cells displayed dual phosphorylation of PKCalpha/betaII at carboxyl-terminal sites (Thr-638/641 and Ser-657/660), whereas in MCF-7 cells PKCalpha/betaII were phosphorylated at Ser-657/660 but not Thr-638/641. Inhibition of ceramide synthesis by fumonisin B1 overcame the defect in PKC phosphorylation and restored translocation of PKCalpha/betaII to the pericentrion. To determine the involvement of ceramide-activated protein phosphatases in PKC regulation, we employed small interference RNA to silence individual Ser/Thr protein phosphatases. Knockdown of isoforms alpha or beta of the catalytic subunits of protein phosphatase 1 not only increased phosphorylation of PKCalpha/betaII at Thr-638/641 but also restored PKCbetaII translocation to the pericentrion. Mutagenesis approaches in HEK-293 cells revealed that mutation of either Thr-641 or Ser-660 to Ala in PKCbetaII abolished sequestration of PKC, implying the indispensable roles of phosphorylation of PKCalpha/betaII at those sites for their translocation to the pericentrion. Reciprocally, a point mutation of Thr-641 to Glu, which mimics phosphorylation, in PKCbetaII overcame the inhibitory effects of ceramide on PKC translocation in PMA-stimulated MCF-7 cells. Therefore, the results demonstrate a novel role for carboxyl-terminal phosphorylation of PKCalpha/betaII in the translocation of PKC to the pericentrion, and they disclose specific regulation of PKC autophosphorylation by ceramide through the activation of specific isoforms of protein phosphatase 1.