Recent studies have demonstrated that, during infection of macrophages by mycobacteria, phospholipids (PLs) are released from the mycobacterial cell wall within infected macrophages and transported out of this compartment into intracellular vesicles. The release of these PLs may have functions that influence the outcome of mycobacterial infections. Despite their important role, little is known about the biosynthesis of PLs in mycobacteria. In all organisms, PL biosynthesis begins with acylation of sn -glycerol 3-phosphate to form phosphatidic acid (PA), which is then converted to the central liponucleotide intermediate, cytidine diphosphate-diacylglycerol (CDP-DAG) via the CDP-DAG synthase (CDS). The present work examines CDS activity in Mycobacterium smegmatis extracts, with regard to subcellular localization, pH dependence, bivalent and univalent cation requirement, substrate specificity and regulation by nucleotides. We show that CDS activity, which is mainly found within the cytoplasmic membrane, is Mg(2+)-dependent and activated by K(+) ions. Among PAs containing saturated fatty acids, dipalmitoyl-PA is the preferred substrate [ K (m)=0.23+/-0.03 mM for Triton X-100 (v/v)/PA in the ratio 5:1]. Moreover, CDS activity is inhibited by the reaction products PP(i) (IC(50)=1.5 mM), CDP-DAG (IC(50)=0.3 mM) and the nucleotides ATP, UTP and GTP. This study contributes to the delineation of PL biosynthesis in mycobacteria.