The ability of glucagon (10 nM) to increase hepatocyte intracellular cyclic AMP concentrations was reduced markedly by the tumour-promoting phorbol ester TPA (12-O-tetradecanoyl phorbol-13-acetate). The half-maximal inhibitory effect occurred at 0.14 ng/ml TPA. This action occurred in the presence of the cyclic AMP phosphodiesterase inhibitor isobutylmethylxanthine (1 mM) indicating that TPA inhibited glucagon-stimulated adenylate cyclase activity. TPA did not affect either the binding of glucagon to its receptor or ATP concentrations within the cell. TPA did inhibit the increase in intracellular cyclic AMP initiated by the action of cholera toxin (1 microgram/ml) under conditions where phosphodiesterase activity was blocked. TPA did not inhibit glucagon-stimulated adenylate cyclase activity in a broken plasma membrane preparation unless Ca2+, phosphatidylserine and ATP were also present. It is suggested that TPA exerts its inhibitory effect on adenylate cyclase through the action of protein kinase C. This action is presumed to be exerted at the point of regulation of adenylate cyclase by guanine nucleotides.