The GTP-binding protein, G(o), is present at very high concentration in the neuronal growth cone membrane. The expression of activated mutants of the a subunit of G(o) increases neurite outgrowth. To determine the intracellular mechanism for this outgrowth, we have examined activated alpha o-dependent outgrowth in the presence of agents which modulate different signal transduction cascades. Activation of protein kinase C with phorbol esters or with diacylglycerol prevents the alpha o-dependent increase in neurite extension. Inhibition of protein kinase C with staurosporine, with H7, or with long-term, high dose phorbol ester treatment resulted in greater neurite elongation, and no further increase after activated alpha o transfection. The protein phosphatase inhibitor, okadaic acid, also blocked the effect of activated alpha o. In contrast, tyrosine kinase inhibitors and agents which alter cAMP levels did not alter activated alpha o-dependent neurite extension. We tested a number of compounds which alter intracellular calcium levels. TMB-8 and thapsigargin prevented an increase in outgrowth by activated alpha o, but diltiazem, Bay K8644 and dantrolene had no effect on activated alpha o-dependent outgrowth. These studies suggest that activated alpha o increases neurite outgrowth by inhibiting protein kinase C and by modulating intracellular calcium release.