The broad objective of these studies was to understand the nature of cyclic GMP system and the mechanism(s) whereby hormone, autacoids and drugs alter this signal in various physiological systems. Studies were undertaken on the modulation of guanylate cyclase activity by oxygen-radicals/nitric oxide and the mechanism(s) of generation of nitric oxide by receptor-selective hormones. We observed that cytosolic guanylate cyclase undergoes significant stimulation in the presence of oxygen-radicals/nitric oxide. This activation by nitric oxide can be reversed by hemeproteins, thus, enabling guanylate cyclase system to cycle between activated and deactivated state. The evidence is presented that oxygen-radicals are required for the synthesis of nitric oxide by NO synthase as demonstrated by inhibition of NO formation by oxygen-radical scavengers. And finally, the data is presented that acetylcholine-induced elevations of intracellular levels of cyclic GMP can be attenuated by muscarinic antagonist, atropine and superoxide anion scavenger, nitroblue tetrazolium. These observations establish a novel concept that activation of hormone receptors on the cell surface, triggers generation of oxygen radicals and hydrogen peroxide which participates in the catalytic conversion of L-arginine to nitric oxide by nitric oxide synthase in the presence of calcium ion. The oxygen-radicals/NO, thus formed, oxidatively activate guanylate cyclase and transduce the message of calcium-dependent hormones.