ADP-ribosylation factor (ARF), a small GTPase required for vesicle formation, has been identified as an activator of phospholipase D (PLD), thus implying that PLD is localized at intracellular organelles. HL60 cells were prelabelled with [14C]acetate for 72 h and, after disruption, fractionated on a linear sucrose gradient. ARF1-regulated PLD activity in each fraction was assessed by measurement of phosphatidylethanol production. Two peaks of activity were identified, coincident with markers for Golgi/endoplasmic reticulum/granules (endomembranes) and plasma membrane respectively. Analysis of the fractions using exogenous phosphatidylcholine as substrate confirmed the presence of ARF1-dependent PLD activity in endomembranes and plasma membrane, and also identified an additional activity in the cytosol. In formyl-Met-Leu-Phe-stimulated cells, PLD activity as assessed by phosphatidylethanol formation was also associated with both the plasma membrane and endomembranes. Since ARF1-regulated PLD activity requires phosphatidylinositol 4,5-bisphosphate (PIP2), the distributions of inositol lipids and the kinases responsible for lipid phosphorylation were examined. PIP2 was highly enriched at the plasma membrane, whereas phosphatidylinositol (PI) and phosphatidylinositol 4-phosphate (PI4P), the precursors for PIP2 synthesis, were found predominantly at endomembranes. The distribution of PI 4-kinase and PI4P 5-kinase activities confirmed the plasma membrane as the major site of PIP2 production. However, endomembranes possessed substantial PI 4-kinase activity and some PI4P 5-kinase activity, illustrating the potential for PIP2 synthesis. It is concluded that:(1) ARF1-regulated PLD activity is localized at endomembranes and the plasma membrane, (2) PIP2 is available at both membrane compartments to function as a cofactor for ARF-regulated PLD, and (3) in intact cells, formyl-Met-Leu-Phe stimulates PLD activity at endomembranes as well as plasma membrane.