Synergistic regulation of glycogen phosphorylase a by the competitive inhibitors glucose and caffeine in vitro indicates a possible physiological role for the negative effector site which binds caffeine (nucleoside site). In intact viable hepatocytes glucose promotes the phosphorylase a to be conversion by phosphorylase phosphatase. This conversion is considered to be a necessary prelude to the activation of glycogen synthase by phosphatase and of importance in hepatic regulation of glucose homeostasis. The effects of glucose and(or) caffeine on the conversion of phosphorylase a to b and synthase b to a were studied. Assays of phosphorylase a were used which limited synergistic inhibition (in the assay) by these ligands. Such an approach is necessary to achieve an accurate measure of phosphatase activity in the viable hepatocyte when the combination of ligands is used. The data indicate that in the presence of caffeine and glucose together, the rate of loss of phosphorylase a is significantly increased (1.7-fold) over that in the presence of glucose alone. Phosphorylase phosphatase is activated. The sequential activation of glycogen synthase was also accelerated in the presence of both ligands. The results are consistent with an in vivo function for the nucleoside site, similar to that of glucose. A controlling role or phosphorylase in the regulation of glycogen metabolism by glucose is supported. Although the existence and nature of an intracellular effector is as yet unknown, crystallographic analyses of phosphorylase a crystals soaked in perchloric acid extracts of liver demonstrate that the negative effector site binds a natural metabolite.