It has become increasingly clear that agents classically thought to act as neurotransmitters can also alter gene expression. To understand the early events by which neurotransmitters could effect genetic responses, we have studied the induction of two immediate early genes, c-fos and c-jun. These genes encode proteins that form a dimeric complex (AP-1) active as a transcriptional factor. Using the stable acetylcholine analog carbachol to activate muscarinic receptors (mAChR) in a glial cell line (1321N1), we show that c-fos and c-jun mRNA levels are transiently increased, reaching a maximum at 30 min after agonist addition. Experiments in which the actions of carbachol are blocked by adding atropine at various times demonstrate that only 1.5 min of agonist stimulation is needed to give maximal increases in c-fos or c-jun mRNA at 30 min. These results suggest that events previously shown to occur in the first minute of mAChR occupation (the mobilization of intracellular Ca2+, activation of protein kinase C) are sufficient for induction of these immediate early genes. In cells in which protein kinase C has been down-regulated, carbachol no longer stimulates c-fos or c-jun expression, indicating a critical role for protein kinase C in these responses. In cells loaded with bis-(o-aminophenoxy)ethane-N,N,N',N'-tetraacetic acid (BAPTA) to buffer increases in cytosolic [Ca2+], mAChR-mediated induction of c-fos is markedly reduced; in contrast there is enhanced c-jun expression. The strong enhancement of c-jun induction by carbachol in BAPTA-treated cells is due at least in part to mRNA stabilization. Experiments using phorbol ester (phorbol 12-myristate 13-acetate) in combination with the Ca2+ ionophore ionomycin confirm that activation of protein kinase C induces c-fos and c-jun expression and that a concomitant increase in cytosolic [Ca2+] potentiates the induction of c-fos while repressing that of c-jun. The data suggest that the ability of neurotransmitters or growth factors to mobilize Ca2+ would modulate the effect of concomitant protein kinase C activation on AP-1 generation and consequent target gene expression.