In contrast to their role as potent tumor promoters, phorbol esters can cause inhibition of cell growth. Because the effect of phorbol esters occurs through activation of protein kinase C (PKC) and because activated PKC is translocated to the membrane placing it in a position to act on the intracellular portion of the growth factor receptor, we asked whether this inhibitory effect is mediated through the action of phorbol 12-myristate 13-acetate (PMA) on receptor association with the signal transfer proteins. When added to rat vascular smooth muscle (VSM) cells concurrently with basic fibroblast growth factor (bFGF), PMA at 100 ng/ml completely inhibits bFGF-stimulated DNA synthesis. Under the same growth-inhibitory conditions of PMA addition, aggregation of phosphatidylinositol 3-kinase (PI3K) to the fibroblast growth factor receptor and tyrosine phosphorylation of the 85-kDa regulatory component of the signal transfer protein PI3K are reduced by 94 and 79%, respectively. PI3K catalytic activity, as measured by conversion of phosphatidylinositol to phosphatidylinositol 3-phosphate, is decreased 88% by PMA addition. This effect is not specific to PI3K, since aggregation of phospholipase C-gamma 1 to the activated bFGF receptor is also decreased by PMA treatment. In addition, the PI3K inhibitor wortmannin markedly attenuates bFGF-stimulated VSM cell growth in a dose-dependent manner. These data suggest that the site of growth inhibition by PMA in VSM cells lies upstream of signal transfer particle aggregation and that such growth arrest may be mediated through inhibition of activation of PI3K.