Lithium inhibits in vitro as well as in vivo several hormone‐stimulated adenylate cyclases. The aim of this study was to investigate the mechanism by which lithium inhibits adenylate cyclase in vitro. It was found that lithium inhibited both the norepinephrine‐ and the glucagon‐induced cAMP accumulation in rat fat cells at lithium concentrations above 10 mM. The basal cAMP content was unaffected even at 40 mM of lithium. The inhibitory action was time‐dependent and reversible, indicating an intracellular site of action. Lithium inhibited both norepinephrine‐ and glucagon‐stimulated cAMP accumulation in a mainly non‐competitive way, but the inhibitory effect decreased with increasing hormone concentrations. In accordance, lithium and propranolol had a supraadditive effect on norepinephrine‐induced cAMP accumulation. It is suggested that lithium affects both the hormone‐receptor binding as well as the transfer of the hormonal stimulus by an intracellular site of action.