The effect of cholera toxin on adenylate cyclase from rat liver has been studied in a broken cell preparation. The activation of the enzyme in this in vitro preparation requires the addition of nicotinamide adenine dinucleotide (NAD) to the incubation medium and the presence of cell components other than the membrane-bound adenylate cyclase. Once the activation of the cyclase is produced, the effect persists despite repeated washing or solubilization of the enzyme. The effect can be obtained with concentrations of cholera toxin as low as 0.4 nM after 15 min of incubation at 22 degrees C, and stimulation can be detected after only 5 min of incubation at 37 degrees C. The activation of the enzyme is still apparent after at least 2 h at 0 degrees C. Preincubation with choleragenoid in vitro does not interfere with this effect of the toxin. Animals pretreated by an intravenous injection of cholera toxin do not respond to the in vitro addition of cholera toxin and NAD to the same extent as untreated animals; i.e., the effects overlap to suggest that the in vitro effect is the same as that in vivo. Responses to isoproterenol, glucagon, and NaF were also similar in the in vitro broken cell-activated system, as previously reported for the enzyme activated in vivo.