Protein kinase C (PKC) has been implicated in the regulation of smooth muscle cell (SMC) contraction and may contribute to airway hyperresponsiveness. Here, we combined optical and biochemical analyses of mouse lung slices to determine the effects of PKC activation on Ca(2+) signaling, Ca(2+) sensitivity, protein phosphorylation, and contraction in SMCs of small intrapulmonary airways. We found that 10 µM phorbol-12-myristate-13-acetate or 1 µM phorbol 12,13-dibutyrate induced repetitive, unsynchronized, and transient contractions of the SMCs lining the airway lumen. These contractions were associated with low frequency Ca(2+) oscillations in airway SMCs that resulted from Ca(2+) influx through L-type voltage-gated Ca(2+) channels and the subsequent release of Ca(2+) from intracellular stores through ryanodine receptors. Phorbol ester stimulation of lung slices in which SMC intracellular Ca(2+) concentration ([Ca(2+)](i)) was "clamped" at a high concentration induced strong airway contraction, indicating that PKC mediated sensitization of the contractile response to [Ca(2+)](i). This Ca(2+) sensitization was accompanied by phosphorylation of both the PKC-potentiated PP1 inhibitory protein of 17 kD (CPI-17) and the regulatory myosin light chain. Thrombin, like the phorbol esters, induced a strong Ca(2+) sensitization that was inhibited by the PKC inhibitor GF-109203X and also potentiated airway contraction to membrane depolarization with KCl. In conclusion, we suggest that PKC activation in small airways leads to both the generation of Ca(2+) oscillations and strong Ca(2+) sensitization; agents associated with airway inflammation, such as thrombin, may activate this pathway to sensitize airway smooth muscle to agonists that cause membrane depolarization and Ca(2+) entry and induce airway hyperresponsiveness.