A specific increase in the membrane content of 1,2-diacylglycerol occurred when erythrocytes were lysed at 20 degrees C in media which did not inclued a chelator of Ca2+ and also when Ca2+ was added to haemoglobin-free erythrocyte ghosts which had been prepared in the presence of ethyleneglycol-bis-(beta-aminoethylether)-N,N'-tetraacetic acid (EGTA). The maximum increase was about 20-fold. The production of 1,2-diacylglycerol appeared to be caused by an endogenous membrane-bound phospholipase C which was half-maximally activated at less than 1 muM Ca2+ and which had access to only about 0.6-0.8% of the cells' glycerolipids. This activity was optimal at pH 7.0-7.2 in the presence of 0.1 mM Ca2+; under these conditions diacylglycerol production was complete within 5-10 min. Enzyme activity was markedly decreased at low temperatures, and was abolished by heating at 100 degrees C for 1 min.