Rat hepatocytes whose phosphatidylinositol 4-phosphate (PIP) and phosphatidylinositol 4,5-bisphosphate (PIP2) had been labelled for 60 min with 32P were treated with glucagon for 10 min or phenylephrine for 2 min. Glucagon caused a 20% increase in PIP but no change in PIP2 whereas phenylephrine caused a similar increase in PIP but a 15% decrease in PIP2. Addition of both hormones together for 10 min produced a 40% increase in PIP. A crude liver mitochondrial fraction incubated with [32P]Pi and ADP incorporated label into PIP, PIP2 and phosphatidic acid. The PIP2 was shown to be in contaminating plasma membranes and PIP in both lysosomal and plasma-membrane contamination. A minor but definitely mitochondrial phospholipid, more polar than PIP2, was shown to be labelled with 32P both in vitro and in hepatocytes. The rate of 32P incorporation into PIP was faster in mitochondrial/plasma-membrane preparations from rats treated with glucagon or if 3 microM-Ca2+ and Ruthenium Red were present in the incubation buffer. Loss of 32P from membranes labelled in vitro was shown to be accompanied by formation of inositol 1,4,5-trisphosphate (IP3) and inositol 1,4-bisphosphate, and was faster in preparations from glucagon-treated rats or in the presence of 3 microM-Ca2+. It is concluded that glucagon stimulates both PIP2 phosphodiesterase and phosphatidylinositol kinase activities, as does the presence of 3 microM-Ca2+. The resulting formation of IP3 may be responsible for the observed release of intracellular Ca2+ stores. The roles of a guanine nucleotide regulatory protein and phosphorylation in mediating these effects are discussed.