1-(5-Isoquinolinylsulfonyl)-2-methylpiperazine (H7), a potent inhibitor of protein kinase C, induced neuritogenesis in Neuro-2a cells, whereas N-(2-guanidinoethyl)-5-isoquinolinesulfonamide (HA 1004), which inhibits more efficiently cAMP- and cGMP-dependent protein kinases, did not. The effect, noticeable after 3 hr, was maximum (13-fold increase at 500 microM H7) between 1 and 3 days and was maintained over 2 months. In controls, 90% of the cells were undifferentiated, whereas after 3 hr with 500 microM H7 only 25% of the cells remained undifferentiated. DNA synthesis decreased as the number of differentiated cells increased. Differentiation is also functional since acetylcholinesterase activity increased approximately 7-fold after 48 hr with 500 microM H7. Phorbol 12-myristate 13-acetate, a specific activator of protein kinase C, prevented or reversed the induction of neuritogenesis and the inhibition of DNA synthesis by H7. There is a good correlation between the level of protein kinase C and the percentage of differentiated cells. The results indicate that protein kinase C may play a key role in the control of differentiation of neural cells. Some possible clinical implications are briefly discussed.