Cholesterylphosphoryldimethylethanolamine is a zwitterionic compound which is a good bilayer stabilizer. As has been found with many other compounds having these properties, cholesterylphosphoryldimethylethanolamine is found to be a potent inhibitor of protein kinase C in both vesicle and micelle assay systems. The kinetics of the inhibition in Triton X-100 micelles was non-competitive with respect to ATP, histone, diolein, phorbol ester and Ca2+. It has a Ki of about 30 μm. The inhibition kinetics as a function of phosphatidylserine concentration is more complex but suggestive of competitive inhibition. Cholesterylphosphoryldimethylethanolamine does not prevent the partitioning of protein kinase C into the membrane. This inhibitor lowers the Ca2+-phosphatidylserine-independent phosphorylation of protamine sulfate by protein kinase C and directly affects the catalytic segment of the enzyme generated by tryptic hydrolysis. Thus, this zwitterionic bilayer stabilizing inhibitor of protein kinase C both competes with the binding of phosphatidylserine as well as affects the active site of protein kinase C.