The Aplysia nervous system contains two phorbol ester-activated protein kinase C isoforms, the Ca(2+)-activated Apl I and the Ca(2+)- independent Apl II. Short-term applications of the facilitatory transmitter serotonin (5-HT) activates Apl I, but not Apl II. In contrast, Apl II, but not Apl I, can form an autonomous kinase. To investigate the biochemical characteristics of the Aplysia kinases that might underlie their differential activation, we expressed Apl I, Apl II, and two derivatives of Apl II with deletions in the amino-terminal 150 amino acid E region in insect cells using the baculovirus system. Similar to nervous system extracts, expressed Apl II has more autonomous activity than Apl I. Removal of the E region lowered the amount of phosphatidylserine required for activation of Apl II, but did not remove the autonomous kinase activity. In addition, phosphatidylserine vesicles could sediment fusion proteins containing the E region, consistent with a role for the E region in lipid interactions. A partial deletion of the E region modifies activation of Apl II by phorbol esters and oleic acid, suggesting that in the intact enzyme the E region interacts with the phorbol ester-binding domain of the kinase. These results introduce a model whereby the E region acts as a negative regulator of Apl II activation and suggest that this inhibition may explain the inability of short-term applications of 5-HT to activate Apl II.