When urea and NaCl are employed as the major solutes of high osmolality buffers, the cyclic AMP (cAMP) content of oxygenated slices of rat renal inner medulla increases three- to fivefold as osmolality is decreased from 1,650 to 305 mosM. Incubation of slices in Ca2+-free media containing 2 mM EGTA largely abolished this action of osmolality on cAMP, whereas exclusion of Mg2+ or 5+ from the incubation media was without effect. Addition of Ca2+ to Ca2+-deprived inner medulla incubated at 750 mosM (175 mM Na+, 380 mM urea) significantly increased tissue cAMP and media prostaglandin (PG)E accumulation. Ca2+ also stimulated the release of 14C-fatty acid from Ca2+-deprived slices prelabeled with [14C]arachidonate, but not from those labeled with [14C]palmitate. The divalent cation ionophore A23187 enhanced the actions of Ca2+ to increase tissue cAMP, media PGE accumulation, and the release of [14C]-arachidonate from prelabeled inner medulla. By contrast, when slices were incubated at 1,650 mosM (365 mM Na+, 900 mM urea) in the presence or absence of A23187, all of these actions of Ca2+ were markedly suppressed or abolished. Addition of exogenous arachidonate increased tissue cAMP and media PGE at both 750 and 1,650 mosM, whereas palmitate and stearate had no effect on cAMP at either osmolality. The actions of Ca2+ and arachidonate to increase cAMP and PGE accumulation were abolished by the cyclo-oxygenase inhibitors, indomethacin and meclofenamate. They were also abolished by exclusion of molecular O2, which serves as cosubstrate with arachidonate in prostaglandin synthesis. At maximally effective concentrations, exogenous PGE2 and arachidonate produced similar increases in inner medullary cAMP. The maximal effects of the two agents on cAMP were not additive, but were expressed in the absence of Ca2+ at both 750 and 1,650 mosM. However, in marked contrast to the O2-dependent action of arachidonate, PGE2 increased cAMP in the presence or absence of O2. Comparison of the separate actions of urea and NaCl indicated that suppression of Ca2+-responsive [14C]arachidonate release, PGE, and cAMP accumulation at 1,650 mosM reflected primarily an effect of urea, whereas hypertonic NaCl, mannitol, and sucrose alone stimulated inner medullary cAMP and PGE accumulation by a pathway which did not require extracellular Ca2+. Analogous to the actions of hypertonic urea, tetracaine and mepacrine inhibited the actions of Ca2+ plus A23187 to stimulate [14C]-arachidonate release, PGE, and cAMP accumulation. Inhibition of PGE and cAMP accumulation by tetracaine and mepacrine was also overcome by arachidonate. The results suggest that high osmolaity media with urea as a major solute reduces inner medullary cAMP content, at least in part, through effects on Ca2+-dependent prostaglandin synthesis. Inhibition of PGE synthesis, in turn, may be the result of osmotic suppression of Ca2+-dependent release of arachidonate, the availability of which is often rate limiting to prostaglandin generation.