Human T-cell lymphotropic virus type 1 Tax(1) induces the activation and nuclear localization of the cellular transcription factor, NF-kappa B. Treatment of cells with calphostin C, a protein kinase C (PKC) inhibitor, blocked induction of NF-kappa B DNA binding activity in human T-cell lymphotropic virus type 1-transformed C81 cells and Tax(1)-stimulated murine pre-B cells, suggesting that PKC was an important intermediate in the NF-kappa B induction pathway. We further demonstrate that Tax(1) associates with, and activates, PKC. PKC was coimmunoprecipitated with anti-Tax(1) sera from Tax(1)-expressing MT4 extracts and Jurkat extracts in the presence of exogenous Tax(1) protein. In addition, the glutathione-S-transferase-Tax(1) protein bound specifically to the alpha, delta, and eta PKC isoenzymes synthesized in rabbit reticulocyte lysates. The addition of Tax(1) to in vitro kinase reaction mixtures leads to the phosphorylation of Tax(1) and an 18-fold increase in the autophosphorylation of PKC. Transfection of Jurkat cells with wild-type Tax(1) stimulated membrane translocation of PKC. In contrast, Tax(1) mutant M22, which fails to stimulate NF-kappa B-dependent transcription, failed to stimulate membrane translocation of PKC. Tax(1) did not directly increase PKC phosphorylation of I kappa B alpha. Our results are consistent with a model in which Tax(1) interacts with PKC and stimulates membrane translocation and triggering of the PKC pathway. Subsequent steps in the PKC cascade likely stimulate phosphorylation of I kappa B alpha.