Cysteine-rich domains (Cys-domains) are approximately 50-amino acid-long protein domains that complex two zinc ions and include a consensus sequence with six cysteine and two histidine residues. In vitro studies have shown that Cys-domains from several protein kinase C (PKC) isoforms and a number of other signaling proteins bind lipid membranes in the presence of diacylglycerol or phorbol ester. Here we examine the second messenger functions of diacylglycerol in living cells by monitoring the membrane translocation of the green fluorescent protein (GFP)-tagged first Cys-domain of PKC-gamma (Cys1-GFP). Strikingly, stimulation of G-protein or tyrosine kinase-coupled receptors induced a transient translocation of cytosolic Cys1-GFP to the plasma membrane. The plasma membrane translocation was mimicked by addition of the diacylglycerol analogue DiC8 or the phorbol ester, phorbol myristate acetate (PMA). Photobleaching recovery studies showed that PMA nearly immobilized Cys1-GFP in the membrane, whereas DiC8 left Cys1-GFP diffusible within the membrane. Addition of a smaller and more hydrophilic phorbol ester, phorbol dibuterate (PDBu), localized Cys1-GFP preferentially to the plasma and nuclear membranes. This selective membrane localization was lost in the presence of arachidonic acid. GFP-tagged Cys1Cys2-domains and full-length PKC-gamma also translocated from the cytosol to the plasma membrane in response to receptor or PMA stimuli, whereas significant plasma membrane translocation of Cys2-GFP was only observed in response to PMA addition. These studies introduce GFP-tagged Cys-domains as fluorescent diacylglycerol indicators and show that in living cells the individual Cys-domains can trigger a diacylglycerol or phorbol ester-mediated translocation of proteins to selective lipid membranes.