Although interleukin-1 (IL-1) reduces pancreatic islet content of ATP and GTP, the distal events that mediate its inhibitory effects on insulin secretion remain poorly understood. Herein, the activation of phospholipase C (PLC) was quantified during islet perifusions. An 18-h exposure to IL-1 (100 pM) totally vitiated activation of PLC induced by glucose, an effect that requires ATP and GTP and closure of the ATP-dependent K⁺ (K_ATP) channel. Surprisingly, however, when islets were depolarized directly using either of two agonists, glyburide (which does not act via generation of purine nucleotides) or 40 mM K⁺ (which acts distal to K_ATP channel), PLC and insulin secretion were again obliterated by IL-1. IL-1 also reduced the labeling of phosphoinositide substrates; however, this effect was insufficient to explain the inhibition of PLC, since the effects on substrate labeling, but not on PLC, were prevented by coprovision of guanosine or adenosine. Furthermore, when IL-1-treated islets were exposed to 100 µM carbachol (which activates PLC partially independent of extracellular Ca²⁺), the effects were still obliterated by IL-1. These data (together with the finding that IL-1 inhibited Ca²⁺-induced insulin release) suggest that, in addition to its effects on ATP synthesis and thereby on the K_ATP channel, IL-1 has at least two undescribed, distal effects to block both PLC as well as Ca²⁺-induced exocytosis. The latter correlated best with IL-1's effect to impede phosphoinositide synthesis, since it also was reversed by guanosine or adenosine.