We tested the hypothesis that, in airway smooth muscle cells, stimulation of G-protein-coupled receptors by contractile agonists activates Src kinase and that this kinase modulates cell contractility and Ca²⁺ signaling by affecting the levels of the phospholipase C substrate phosphatidylinositol 4,5-bisphosphate (PIP₂). Stimulation of cultured rat tracheal smooth muscle cells with serotonin (5-HT) induced an increase in Src activity, Ca²⁺ mobilization, and contraction (decrease in cell area). 5-HT-evoked cell contraction was reduced by a specific inhibitor of Src family kinases, 4-amino-5(4-methylphenyl)-7-(t-butyl)pyrazolo[3,4-d]pyrimidine (PP1). Peak Ca²⁺ responses to 5-HT were attenuated by PP1 and an anti-Src-blocking antibody and augmented by expression of constitutively activated Y529F Src. Sustained phases of Ca²⁺ responses to 5-HT and Ca²⁺ influx resulting from emptying of Ca²⁺ stores in the endoplasmic reticulum by thapsigargin were also decreased after PP1 treatment. PP1 significantly reduced the turnover of inositol phosphates produced on 5-HT stimulation and the amount of PIP₂ in the Triton X-100-insoluble lipid fraction. Overall, these data demonstrate that, in rat tracheal smooth muscle cells, Src kinase modulates 5-HT-evoked cell contractility and Ca²⁺ signaling by regulating PIP₂ levels and Ca²⁺ influx.