Isolated rat adipocytes were utilized to investigate the activation mechanisms and the role of the hormone-responsive particulate cAMP Phosphodiesterase (PDE) in insulin-dependent regulation of lipolysis. Lipolysis, cAMP-dependent protein kinase (A-kinase) and PDE were characterized under varying levels of adenylate cyclase activation and inhibition --- e.g., during activation of lipolysis by various combinations of adenosine deaminase (ADA), isoproterenol (ISO) or adenylate cyclase inhibitors, in the presence or absence of insulin. Treatment of fat cells with either ADA or beta-agonist lead to rapid increases in A-kinase, lipolysis and particulate cAMP PDE activity. The Kact values for beta-agonist activation of both lipolysis and PDE are increased similarly as a function of increasing PIA. These data implicate A-kinase-mediated phosphorylation as a mechanism of PDE activation by lipolytic agents. Insulin regulation of lipolysis and cAMP PDE is optimal in the presence of adenylate cyclase inhibition, suggesting a role for guanyl nucleotide-binding proteins in insulin action. In the presence of beta-agonist, insulin lowers A-kinase activity and inhibits lipolysis--provided that nanomolar PIA is present, and the A-kinase ratio is less than 0.7. In the presence of PIA (or other inhibitors), maximally-effective concentrations of insulin and ISO exert additive effects of PDE activity. The particulate cAMP PDE from rat (and bovine) adipose tissue was solubilized with polyoxyethylene non-ionic detergents, purified to apparent homogeneity using a PDE inhibitor-affinity column and characterized in terms of sensitivity to several selective PDE inhibitors.