Macroscopic consequences of the formation of diacylglycerol by phospholipase C (PC-PLC) in giant 1-stearoyl-2-oleoyl-sn-glycero-3-phosphocholine (SOPC) unilamellar vesicles (GUVs, diameter 10-100 mum) were studied by phase contrast and fluorescence microscopy. PC-PLC caused a series of fast stepwise shrinkages of fluid SOPC GUVs, continuing until the vesicle disappeared beyond the optical resolution of the microscope. The presence of N-palmitoyl-sphingomyelin (mole fraction X = 0.25) in the GUVs did not affect the outcome of the PC-PLC reaction. In addition to hydrolysis, PC-PLC induced adhesion of vicinal vesicles. When multilamellar SOPC vesicles were used only a minor decrease it their diameter was evident suggesting that PC-PLC can exert its hydrolytic activity only in the outer monolayer. A series of stepwise shrinkages was observed also for 1,2-dimyristoyl-sn-glycero-3-phosphocholine (DMPC) GUVs above their main phase transition temperature, T-m, i.e., when the bilayer is in the liquid crystalline state. However, this process was not observed for DMPC GUVs in the gel state, below T-m. These results are supported by the enhanced activity of PC-PLC upon exceeding T-m of DMPC large unilamellar vesicles (diameter similar to0.1 mum) used as a substrate. Studies on SOPC monolayers revealed that PC-PLC,can exert its hydrolytic activity only at surface pressures below similar to30 mN/m. Accordingly, the lack of changes in the gal state DMPC GUVs could be explained by the equilibrium lateral pressure in these vesicles exceeding this critical value.