Compound action potentials (CAP) in response to orthodromic stimulation of the presynaptic nerve trunk were recorded extracellularly from the bullfrog sympathetic ganglion. Application of lidocaine, tetracaine or dibucaine significantly suppressed the amplitude of CAP. In the presence of phorbol 12,13-dibutyrate (PDBu), an activator of protein kinase C, lidocaine suppression was 3.5-fold more potent, but suppressive effects of tetracaine and dibucaine were not potentiated by PDBu. The acetylcholine (ACh)-induced depolarizing response intracellularly recorded from sympathetic ganglion cells was markedly suppressed by PDBu. Thus, activation of protein kinase C augmented the transmitter release by phosphorylating certain proteins involved in the release mechanism at presynaptic nerve terminals, while it suppressed the nicotinic ACh-receptor activity by phosphorylation at the postsynaptic membrane. However, activation of protein kinase C apparently facilitates synaptic transmission because the augmentation of transmitter release was larger than the suppressive effect on the nicotinic receptors. From these results, it seems likely that protein kinase C activation was responsible for the modified action of lidocaine although the mechanism of this effect is unclear.