Lithium is the most effective treatment for reducing both the frequency and severity of recurrent affective episodes, but despite extensive research, the molecular mechanisms underlying its therapeutic actions have not been fully elucidated. Signal transduction pathways are in a pivotal position in the central nervous system, able to affect the functional balance between neurotransmitter systems and have clearly been demonstrated to be targets of lithium's actions. We investigate the hypothesis that the action of chronic lithium on PKC isozymes and substrates may be secondary to its potent effect in inhibiting the recycling of inositol. Rats received lithium for 3 weeks and also myo-inositol or saline twice daily via intracerebroventricular (ICV) injections. There was a significant interaction between chronic lithium and myo-inositol administration, with the chronic ICV administration of myo-inositol attenuating lithium's effects on PKC alpha, PKC epsilon, and on pertussis toxin-catalyzed [32P]ADP-ribosylation. These results suggest that the effects of chronic lithium on signal transduction pathways may stem initially from its inhibition of inositol-1-phosphatase. Given the critical role of PKC isozymes and G proteins in modulating intracellular cross-talk between neurotransmitter systems and thereby the integrative functions of the CNS, future studies using other inhibitors of inositol monophosphatases are warranted, and offer the hope for the development of more potent and more rapidly acting mood-stabilizing drugs.