In cell culture, a partially purified commercial preparation of phospholipase C (PLC) from Clostridium welchii inhibited fusion of myoblasts at concentrations of 12-50 microg per ml. At lower concentrations, PLC-treated cultures were indistinguishable from controls, and at concentrations above 100 microg per ml, PLC-treated cells detached from their substrates. The effect was reversible and fusion resumed approximately one cell cycle time after removal of the enzyme. Neither the percent of cells in the mitotic cycle nor the duration of the different phases of the cycle were altered by PLC at concentrations which inhibited fusion. Cell motility was not reduced by the enzyme. Unfused, PLC-treated myoblasts were virtually indistinguishable in ultrastructure from untreated cells just before fusion. In the presence of PLC, mononucleated myogenic cells did not synthesize thick (150 A) filaments. Treatment of culture medium with insolubilized commercial PLC did not abolish the capacity of the medium to support myogenesis. Chondrocytes treated with PLC divided repeatedly but failed to synthesize metachromatic matrix and failed to incorporate labeled sulfate into chondroitin sulfate. PLC was further purified by chromatography on Sephadex G-100. The resulting preparation was free of detectable protease, yielded one band on SDS-acrylamide gel electrophoresis, and displayed all of the biological activities of the less pure material.