The recent cloning of a family of high affinity melatonin receptors has provided us with a unique opportunity to define the signal transduction pathways used by these receptors. We have studied signaling through the human Mel1a receptor subtype by stable expression of receptor complementary DNA in NIH 3T3 cells. Our data indicate that the human Mel1a receptor is coupled to inhibition of forskolin-stimulated cAMP accumulation by a pertussis toxin-sensitive G protein. Although melatonin alone is without effect on phosphoinositide hydrolysis, it potentiates the effects of PGF2 alpha stimulation on phospholipase C activation. Melatonin potentiates arachidonate release stimulated by PGF2 alpha and by ionomycin. The effects of melatonin on arachidonate release are sensitive to inhibition of protein kinase C. They are independent of the effects of melatonin on cAMP and do not appear to involve activation of mitogen-activated protein kinase. The effects of melatonin on both phosphoinositide hydrolysis and arachidonate release are sensitive to pertussis toxin treatment. Thus, we show that the melatonin signal is transduced by parallel pathways involving inhibition of adenylyl cyclase and potentiation of phospholipase activation.