Vasoactive intestinal peptide (VIP) activates adenylylcyclase in sympathoadrenal cells at concentrations greater than 10(-6) M. We demonstrate here that two forms of a newly discovered peptide with homology to VIP named pituitary adenylate cyclase-activating polypeptide (PACAP) are much more potent activators of signal transduction in PC12 cells. Both the 27- and 38-amino acid forms of PACAP elevate cAMP levels in PC12 cells and stimulate adenylylcyclase in PC12 membranes, with an EC50 near 10(-9) M. PACAP38 additionally is a potent activator of the inositol lipid cascade in PC12 cells, elevating the content of inositol phosphates by 8-fold at 10(-8) M (EC50 = 7 x 10(-9) M). PACAP38 and PACAP27 have been thought to have essentially identical actions, but PACAP27 is 2-3 logs less potent in increasing inositol lipid levels. Moreover, PACAP38 at 10(-8) M is an effective inducer of neuronal morphology in PC12 cells, whereas PACAP27 is much less active in promoting neurite outgrowth. In contrast to the PACAP-preferring receptors on PC12 cells, another class of PACAP-binding sites with equal high affinities for VIP, PACAP38, and PACAP27 has been identified on several other cell types. We find that the cAMP content of rat CH3 pituitary cells, known to have high affinity VIP receptors, is in fact potently elevated by PACAP27 and PACAP38 as well as by VIP. However, PACAP38, even at 10(-6) M, is not capable of significant activation of inositol lipid turnover via these VIP/PACAP nondiscriminating sites.