The fatty acid oleoylethanolamide (OEA) is a satiety factor that excites peripheral vagal sensory nerves, but the mechanism by which this occurs and the molecular targets of OEA are unclear. In this study the ability of OEA to modulate the capsaicin receptor (TRPV1) was explored. OEA alone did not activate TRPV1 expressed in Xenopus oocytes under control conditions, but produced a differential modulation of agonist-evoked responses. OEA enhanced proton-gated TRPV1 currents, inhibited anandamide-evoked currents and had no effect on capsaicin-evoked responses. Following stimulation of protein kinase C (PKC), OEA alone directly activated TRPV1 channel with an EC50 of similar to2 muM at room temperature. This effect was due to direct phosphorylation of TRPV1 because no responses to OEA were observed with mutant channels lacking critical PKC phosphorylation sites, S502A/S800A. In sensory neurons, OEA-induced Ca2+ rises that were selective for capsaicin-sensitive cells, inhibited by the TRPV1 blocker, capsazepine, and occurred in a PKC-dependent manner. Further, after PKC stimulation, OEA activated TRPV1 channels in cell-free patches suggesting a direct mode of action. Thus, TRPV1 represents a potential target for OEA and may contribute to the excitatory action of OEA on sensory nerves.