Peptide hormones can stimulate cyclic GMP synthesis through either of two general mechanisms: some peptides activate the cytoplasmic form of guanylate cyclase via a coupling factor called EDRF (endothelium-derived relaxation factor), while others activate the membrane form by interacting directly with an extracellular binding domain of the cyclase molecule itself. We have investigated the mechanism(s) by which crustacean hyperglycemic hormone (CHH), a neuropeptide that regulates energy metabolism in crustaceans, elevates cyclic GMP levels in lobster muscle. Phosphodiesterase inhibitors potentiate the response in intact tissue. This indicates that the primary effect of the peptide is to activate a cyclase rather than inhibit a phosphodiesterase. Methylene blue, a specific inhibitor of the EDRF pathway, does not block the actions of CHH. In addition, nitroprusside, an agent that directly activates the EDRF pathway in vertebrate animals, does not activate guanylate cyclase either in intact or homogenized lobster muscle. This indicates that the EDRF pathway, although prominent in vertebrate muscle, is not found in crustaceans and further suggests that the membrane cyclase is the most likely target of CHH. Membrane and soluble cyclases can be isolated from homogenates of lobster muscle (in a 3.5:1 ratio), and both are stimulated by Mn2+ and inhibited by Ca2+. CHH has no effect on the soluble enzyme. Coupling of CHH receptors to the particulate cyclase, however, remains intact in isolated membranes, thus providing a new model system for the study of receptor/cyclase interactions.