In response to the kinase activity of v-Src there is an increase in the membrane association of the novel protein kinase C (PKC) isoform PRC delta (Zang, Q., Frankel, P., and Foster, D. A, (1995) Cell Growth Differ, 6, 1367-1373). Ne report here that in v-Src-transformed cells PKC delta co-immunoprecipitates with v-Src and is phosphorylated on tyrosine. The tyrosine-phosphorylated PKC delta had reduced enzymatic activity relative to the non-tyrosine-phosphorylated PKC delta from v-Src-transformed cells, The association between Src and PKC delta was dependent upon both an active Src kinase and membrane association, The association between c-Src Y527F and PKC 6 was substantially enhanced by mutating a PHC phosphorylation site at Ser-la in Src to Ala indicating that PKC delta phosphorylation of Src at Ser-la destabilizes the interaction, possibly in a negative feedback loop. These data demonstrate that upon recruitment of PKC delta to the membrane in v-Src-transformed cells there is the formation of a Src PKC delta complex in which PKC delta becomes phosphorylated on tyrosine and down-regulated.