Diacylglycerol (DAG) is a key lipid second messenger downstream of cellular receptors that binds to the C1 domain in many regulatory proteins. Protein kinase C (PKC) isoforms constitute the most prominent family of signaling proteins with DAG-responsive C1 domains, but six other families of proteins, including the chimaerins, Ras-guanyl nucleotide-releasing proteins (RasGRPs), and Munc13 isoforms, also play important roles. Their significant involvement in cancer, immunology, and neurobiology has driven intense interest in the C1 domain as a therapeutic target. As with other classes of targets, however, a key issue is the establishment of selectivity. Here, using [H]phorbol 12,13-dibutyrate ([H]PDBu) competition binding assays, we found that a synthetic DAG-lactone, AJH-836, preferentially binds to the novel PKC isoforms PKCδ and PKCϵ relative to classical PKCα and PKCβII. Assessment of intracellular translocation, a hallmark for PKC activation, revealed that AJH-836 treatment stimulated a striking preferential redistribution of PKCϵ to the plasma membrane relative to PKCα. Moreover, unlike with the prototypical phorbol ester phorbol 12-myristate 13-acetate (PMA), prolonged exposure of cells to AJH-836 selectively down-regulated PKCδ and PKCϵ without affecting PKCα expression levels. Biologically, AJH-836 induced major changes in cytoskeletal reorganization in lung cancer cells, as determined by the formation of membrane ruffles, via activation of novel PKCs. We conclude that AJH-836 represents a C1 domain ligand with PKC-activating properties distinct from those of natural DAGs and phorbol esters. Our study supports the feasibility of generating selective C1 domain ligands that promote novel biological response patterns.