The effects of neomycin on Ca2+ fluxes and inositol polyphosphates in hepatocytes were investigated since it has been proposed that this antibiotic inhibits inositol 1,4,5-triphosphate formation in fibroblasts [D.H. Carney, D.L. Scott, E.A. Gordon and E.F. LaBelle, Cell 42, 479 (1985)]. In hepatocytes incubated at 1.3 mM extracellular Ca2+ (Ca2+0) neomycin (2 mM) inhibited 45Ca2+ exchange both in the presence or absence of vasopressin. At 1.3 mM Ca2+0, but not higher concentrations of Ca2+0, the antibiotic (2 mM) inhibited the increase in glycogen phosphorylase a activity observed at late but not at early times after addition of vasopressin. The antibiotic also inhibited the increase in phosphorylase activity caused by the subsequent addition of 1.3 mM Ca2+0 to cells previously incubated in the presence of vasopressin and in the absence of added Ca2+0. The concentration of the antibiotic (2 mM) which gave half-maximal inhibition of phosphorylase activation by vasopressin had no effect on the activation of phosphorylase by glucagon or the release of Ca2+ from intracellular stores induced by vasopressin. At a concentration of 10 mM, neomycin caused a 50% inhibition of the formation of [3H]inositol polyphosphates induced by vasopressin. It is concluded that neomycin, at concentrations which inhibit phosphoinositide-specific phospholipase C in other types of cells inhibits the inflow of Ca2+ across the plasma membrane but does not inhibit inositol trisphosphate formation in hepatocytes.