The PKC1 gene of the budding yeast Saccharomyces cerevisiae encodes a homolog of the alpha, beta, and gamma isoforms of mammalian protein kinase C (PKC) that is essential for cell growth. Loss of PKC1 function results in a cell lysis defect that is due to a deficiency in cell wall construction. In this study, Pkc1p was modified at its COOH terminus with the influenza virus hemagglutinin epitope and was detected by SDS-polyacrylamide gel electrophoresis as a 145- and 150-kDa doublet when overproduced in yeast cells. Pkc1p displayed intrinsic Ser/Thr protein kinase activity in vitro, possessing a substrate specificity similar to that described for mammalian PKC. Specifically, preferred substrates possess an arginine at position -3 and a basic residue at position +2 relative to the target site. A catalytically inactive missense mutant of Pkc1p failed to complement a pkc1 delta mutant, suggesting that protein kinase activity is required for the biological function of Pkc1p. Both wild-type Pkc1p and the inactive form were isolated as phosphoproteins, indicating that Pkc1p is phosphorylated in vivo by another protein kinase. In vitro protein kinase activity of Pkc1p was not dependent on activating cofactors normally required for stimulation of mammalian PKC. However, mutational incapacitation of the pseudosubstrate site of Pkc1p resulted in constitutive activation of the enzyme, both in vivo and in vitro, suggesting that Pkc1p is normally regulated by a mechanism similar to that of its mammalian counterparts. The apparent molecular mass and substrate specificity of Pkc1p, together with its failure to respond to activating cofactors, suggest that this enzyme is distinct from an enzyme purified previously from budding yeast that has enzymatic properties similar to those of mammalian PKC.