Caveolae undergo a cyclic transition from a flat segment of membrane to a vesicle that then returns to the cell surface. Here we present evidence that this cycle depends on a population of protein kinase C-alpha (PKC-alpha) molecules that reside in the caveolae membrane where they phosphorylate a 90-kD protein. This cycle can be interrupted by treatment of the cells with phorbol-12,13-dibutyrate or agents that raise the concentration of diacylglycerol in the cell. Each of these conditions displaces PKC-alpha from caveolae, inhibits the phosphorylation of the 90-kD protein, and prevents internalization. Caveolae also contain a protein phosphatase that dephosphorylates the 90-kD once PKC-alpha is gone, A similar dissociation of PKC-alpha from caveolae and inhibition of invagination was observed when cells were treated with histamine, This effect was blocked by pyrilamine but not cimetidine, indicating the involvement of histamine H-1 receptors, These findings suggest that the caveolae internalization cycle is hormonally regulated.