Protein kinase C (PKC) is activated in rat renal glomerulus within a week of induction of experimental diabetes. Studies in isolated glomeruli and in cultured endothelial and mesangial cells have demonstrated that high ambient concentrations of glucose activate PKC and thus implicate hyperglycemia per se as a mediator of PKC activation in glomerular cells in diabetes. High glucose concentrations activate PKC by increasing cellular levels of diacylglycerol (DAG), the major endogenous modulator of this signalling system. In contrast to physiological extracellular stimuli of PKC that increase cellular DAG levels by receptor-mediated enhancement of membrane inositol phospholipid hydrolysis, in glomerular cells high concentrations of glucose increase DAG by de novo synthesis from glycolytic intermediates. Activation of PKC by glucose or other agonists increases the permeability of endothelial cells to albumin and stimulates matrix protein synthesis in mesangial cells; it thereby may be involved in the pathogenesis of both the functional and structural alterations of the glomerulus in diabetes. Recent studies in isolated glomeruli from diabetic rats have also implicated activation of PKC in suppression of nitric oxide (NO)-mediated increases in glomerular cGMP generation in response to cholinergic stimuli. In mesangial cells, cGMP suppresses PKC-mediated increases in matrix protein synthesis. Thus, impaired NO-mediated cGMP generation in glomeruli of diabetic individuals may amplify matrix protein synthesis in response to hyperglycemia and other stimuli of PKC. These and other observations suggest that activation of the PKC system by hyperglycemia may represent an important pathway by which glucotoxicity is transduced in susceptible cells in diabetes.