Oxidants released from inflammatory cells contribute to the pathogenesis of acute inflammatory edema in many models. Chemically produced oxidants can reversibly alter the barrier properties of cultured endothelial and epithelial monolayers. This report examines the effects of nonlytic doses of H2O2 on endothelial cell lipids. H2O2 oxidized omega-6 fatty acids in the endothelial cells and initiated hydrolysis of endothelial cell phospholipids. When endothelial cells were exposed to peroxidized linoleic acid, it caused lysis of the cells at doses 1,000-fold lower than effective doses of H2O2. The phospholipid hydrolysis was directed primarily at the inositol phospholipids and consisted of both A and C type phospholipase activity. The phospholipase A hydrolysis resulted in increases in endothelial cell free fatty acids and lysophosphatidylinositol. The phospholipase C hydrolysis resulted in increases in diglycerides, phosphatidic acid, and inositol polyphosphate levels. The phospholipase C hydrolysis of phosphatidylinositol is known to activate protein kinase C in most cells. Stimulation of protein kinase C with phorbol-12,13-dibutyrate increased albumin flux across endothelial monolayers and altered endothelial cell shape, similar to effects of oxidants. These data are consistent with the hypothesis that oxidant-initiated hydrolysis of endothelial cell inositol phospholipids contributes to oxidant-mediated reversible changes in endothelial monolayer barrier function.