Muscarinic receptors of cardiac pacemaker and atrial cells are linked to a potassium channel (IK.ACh) by a pertussis toxin-sensitive GTP-binding protein. The dissociation of G-proteins leads to the generation of two potential transducing elements, alpha-GTP and beta gamma. IK.ACh is activated by G-protein alpha- and beta gamma-subunits applied to the intracellular surface of inside-out patches of membrane. beta gamma has been shown to activate the membrane-bound enzyme phospholipase A2 in retinal rods. Arachidonic acid, which is produced from the action of phospholipase A2 on phospholipids, is metabolized to compounds which may act as second messengers regulating ion channels in Aplysia. Muscarinic receptor activation leads to the generation of arachidonic acid in some cell lines. We therefore tested the hypothesis that beta gamma activates IK.ACh by stimulation of phospholipase A2. When patches were first incubated with antibody that blocks phospholipase A2 activity, or with the lipoxygenase inhibitor, nordihydroguaiaretic acid, beta gamma failed to activate IK.ACh. Arachidonic acid and several of its metabolites derived from the 5-lipoxygenase pathway, activated the channel. Blockade of the cyclooxygenase pathway did not inhibit arachidonic acid-induced channel activation. We conclude that the beta gamma-subunit of G-proteins activates IK.ACh by stimulating the production of lipoxygenase-derived second messengers.