Rat embryo fibroblasts (REF52 cells) and the simian virus 40 transformed derivative (WT6 Ag6) were employed to characterize phospholipase D (PLD) activity in normal and transformed cells. In cells prelabeled with [3H]myristic acid or [3H]glycerol and treated with 12-O-tetradecanoylphorbol-13-acetate (TPA, 50 ng/ml medium) or vasopressin (VP, 100 ng/ml medium) in the presence of ethanol, the formation of labeled phosphatidylethanol (PEt) was 3- to 5-fold higher in REF52 cells than in the transformed cells. The transphosphatidylation of phosphatidylcholine (PC) to PEt was further examined in cell-free assay systems. Results demonstrated that the formation of PEt in the cell-free assays was dependent on the mode of substrate presentation and the source of the PC. With endogenous membrane-bound substrate, the formation of [3H]myristoyl-PEt was 5-fold higher in homogenates derived from normal cells as compared to transformed cell homogenates. In experiments using exogenous labeled PC isolated from either REF52 or transformed cells as substrate, cell-free PLD activity differed greatly with regard to the source of the PC. The formation of PEt from REF52-derived PC was approx. 4-fold higher as compared to PEt formed with PC derived from the transformed cells, irrespective of enzyme source. The results demonstrate that PLD in intact nontransformed fibroblasts is activatable by TPA and VP to a greater extent than in the transformed counterpart. The results from cell-free assays suggest that PLD activity is more dependent on the type of PC substrate than on the source of the enzyme.