Phospholipase D (PLD) has been implicated in the signal transduction pathways initiated by several mitogenic protein tyrosine kinases. We demonstrate for the first time that most notably PLD2 and to a lesser extent the PLD1 isoform are tyrosine phosphorylated by c-Src tyrosine kinase via direct association. Moreover, epidermal growth factor induced tyrosine phosphorylation of PLD2 and its interaction with c-Src in A431 cells. Interaction between these proteins is via the pleckstrin homology domain of PLD2 and the catalytic domain of c-Src. Coexpression of PLD1 or PLD2 with c-Src synergistically enhances cellular proliferation compared with expression of either molecule. While PLD activity as a lipid-hydrolyzing enzyme is not affected by c-Src, wild-type PLDs but not catalytically inactive PLD mutants significantly increase c-Src kinase activity, up-regulating c-Src-mediated paxillin phosphorylation and extracellular signal-regulated kinase activity. These results demonstrate the critical role of PLD catalytic activity in the stimulation of Src signaling. In conclusion, we provide the first evidence that c-Src acts as a kinase of PLD and PLD acts as an activator of c-Src. This transmodulation between c-Src and PLD may contribute to the promotion of cellular proliferation via amplification of mitogenic signaling pathways.