To understand the mechanism underlying the neurotoxicity of lithium ion, we investigated the inhibition of the nerve growth factor-induced neuronal differentiation of rat PCI2 pheochromocytoma cells induced by treatment with Lid. Incubation with 0.1–3 mMLiCI from 30 min before nerve growth factor (NCF) treatment attenuated neurite outgrowth. Moreover, incubation with 3 mMLiCI from 24 h before strongly reduced the neurite outgrowth. The chronic pretreatment inhibited the NCF-caused induction of acetylcholinesterase activity known to be elevated by NCF in transcription-dependent processes, and inhibited expression of c-fos proto-oncogene mRNA. This pretreatment also inhibited the NGF-induced formation of inositol phosphates, accompanied by the significant accumulation of inositol monophosphate. These observations, that chronic treatment with LiCI inhibits the NGF-induced neuronal differentiation in a transcription-dependent manner and inhibits phosphoinositide metabolism, suggest a possible causal relationship between these two events.