The human amnion may be an important source of prostaglandins (PGs) during pregnancy and possibly labor. Glucocorticoids stimulate PG production in confluent amnion cell cultures, but in freshly dispersed cells they inhibit PG production. The purpose of the present study was to determine if this inhibitory effect occurred at the level of arachidonic acid release from lipids. Cells were labeled with radioactive arachidonate and the release of radioactivity was measured in the presence or absence of dexamethasone. No significant effect of dexamethasone treatment was observed. The possibility that glucocorticoid treatment inhibited the release of arachidonate from a specific species of phospholipid was also examined. However, no difference was found in the distribution of arachidonate between lipids isolated from glucocorticoid-treated and untreated cells. Furthermore, dexamethasone treatment did not alter the lipocortin 1 and 2 content of dispersed cells, determined following sodium dodecyl sulfate polyacrylamide gel electrophoresis and immunoblotting. These studies indicate that the inhibition of prostaglandin production by dispersed amnion cells by glucocorticoids most likely occurs at a point distal to arachidonic acid release.