Reduced ability or failure to stimulate cyclic adenosinemonophosphate (AMP) synthesis on a second addition of hormone 30 min after a first stimulation was taken as an indirect indication of the synthesis of the cyclic AMP antagonist prostaglandylinositol cyclic phosphate (cyclic PIP). In diabetic rats, because of an increased possibility of restimulating cyclic AMP synthesis, the formation of cyclic PIP should be reduced. Additionally, severalfold increased basal cyclic AMP synthesis can be observed in diabetic hepatocytes in comparison with controls. Upon measuring cyclic PIP levels after hormonal stimulation in all organs of diabetic rats, it was found that stimulation of cyclic PIP synthesis by insulin decreased gradually in a time-dependent manner. Plasma membranes were prepared from diabetic Ksj db/db mice and from spontaneously hypertensive rats (SHR), and in a subsequent assay for cyclic PIP synthetase, an up to 60% decrease of enzyme activity was found. Cyclic PIP synthetase can be completely inhibited by preincubation with protein kinase A. It is most likely that this serine phosphorylation reaction by which the enzyme is inhibited also in vivo is a result of increased cyclic AMP levels. The addition of 10(-5)-10(-4) M sulfonylureas to the enzyme assay of liver plasma membrane causes full inhibition, and the addition of 10(-5)-10(-4) M biguanides, a two- to fourfold activation of the enzyme. Activation of cyclic PIP synthetase by biguanides can also be demonstrated in intact cells. It is a fast reaction and additive with respect to the activation by fluoride or guanylyl-imidodiphosphate (GMP-PNP), and it is most likely the effect with which the biguanides produce the correcting changes in metabolism. Furthermore, antihypertensive drugs like captopril, guanethidine, and dihydralazine also activate cyclic PIP synthetase. In contrast to the activation by the biguanides, this effect is not additive to the activation by fluoride. It appears that essential hypertension and type 2 diabetes are connected with or may be the result of a reduction in synthesis of the intracellular messenger cyclic PIP, whose synthesis is stimulated by hormones like insulin and noradrenaline (alpha-adrenergic action).