We have previously identified receptors for activated C kinase (RACKs) as components of protein kinase C (PKC) signaling. RACK1, a recently cloned 36-kDa RACK, has short sequences of homology to PKC. A possible explanation for the homologous sequences between the ligand (PKC) and its intracellular receptor (RACK1) may be that, similar to the pseudosubstrate autoregulatory sequence on PKC, there is also a pseudo-RACK1 binding site on the enzyme. If this is the case, peptides with these sequences (derived from either RACK1 or PKC) are expected to affect PKC binding to RACK1 in vitro and PKC-mediated functions in vivo. Here, we show that the PKC-derived peptide (pseudo-RACK1 peptide), but not its RACK1 homologue, modulated PKC function both in vitro and in vivo. Our data suggest that the pseudo-RACK1 peptide binds and activates PKC in the absence of PKC activators and thereby acts as an agonist of PKC function in vivo. Therefore, the pseudo-RACK1 sequence in PKC appears to be another autoregulatory site; when PKC is in an inactive conformation, the pseudo-RACK1 site interacts with the RACK-binding site. Activation of PKC exposes the RACK-binding site, enabling the association of the enzyme with its anchoring RACK. Similar pseudoanchoring sites may regulate the function of other protein kinases.