PRK1/PKN is a member of the protein kinase C (PKC) superfamily of serine/threonine protein kinases. Despite its important role as a RhoA effector, limited information is available regarding how this kinase is regulated. We show here that the last seven amino acid residues at the C-terminus is dispensable for the catalytic activity of PRK1 but is critical for the in vivo stability of this kinase. Surprisingly, the intact hydrophobic motif in PRK1 is dispensable for 3-phosphoinositide-dependent kinase-1 (PDK-1) binding and phosphorylation of the activation loop, as the PRK1-Δ940 mutant lacking the last two residues of the hydrophobic motif and the last 5 residues at the C-terminus interacts with PDK-1 in vivo and has a similar specific activity as the wild-type protein. We also found that the last four amino acid residues at the C-terminus of PRK1 is critical for the full lipid responsiveness as the PRK1-Δ942 deletion mutant is no longer activated by arachidonic acid. Our data suggest that the very C-terminus in PRK1 is critically involved in the control of the catalytic activity and activation by lipids. Since this very C-terminal segment is the least conserved among members of the PKC superfamily, it would be a promising target for isozyme-specific pharmaceutical interventions. © 2004 Elsevier Inc. All rights reserved.