We show that neurotransmitter release at Caenorhabditis elegans neuromuscular junctions is facilitated by a presynaptic pathway composed of a Gqalpha (EGL-30), EGL-8 phospholipase Cbeta (PLCbeta), and the diacylglycerol- (DAG-) binding protein UNC-13. Activation of this pathway increased release of acetylcholine at neuromuscular junctions, whereas inactivation decreased release. Phorbol esters stimulated acetylcholine release, and this effect was blocked by a mutation that eliminates phorbol ester binding to UNC-13. Expression of a constitutively membrane-bound form of UNC-13 restored acetylcholine release to mutants lacking the egl-8 PLCbeta. Activation of this pathway with muscarinic agonists caused UNC-13 to accumulate in punctate structures in the ventral nerve cord. These results suggest that presynaptic DAG facilitates synaptic transmission and that part of this effect is mediated by UNC-13.