Myelin basic protein, an 80-kilodalton (kDa) protein in rat oligodendrocytes, and an 80-kDa basic protein in neuroblastoma x neonatal Chinese hamster brain explant hybrids were phosphorylated extensively when the cells were treated with either phorbol esters (TPA) or diacylglycerols (e.g., oleyoyl-acetylglycerol). TPA-stimulated phosphorylation was inhibited by pre-incubation with 50 microM psychosine (galactosyl-sphingosine), confirming that it is mediated through the phospholipid-dependent protein kinase C (PK-C). Surprisingly, phosphorylation of these proteins was inhibited by incubation of cells with agents which result in activation of cyclic-AMP-dependent protein kinase (dibutyryl cyclic AMP or forskolin). In contrast, phosphorylation of other nonbasic proteins, for example, the oligodendrocyte-specific 2',3'-cyclic nucleotide phosphohydrolase, was stimulated under these conditions (Vartanian et al.: Proceedings of the National Academy of Sciences of the United States of America 85:939, 1988). The possible role of cyclic AMP in activating specific phosphatases or restricting the availability of diacylglycerol for PK-C activation is discussed.