ABSTRACT: Protein kinase C-? (PKC?) is a member of the conventional family of protein kinase C isoforms (cPKCs) that regulate diverse cellular signaling pathways, share a common activation mechanism, and are linked to multiple pathologies. The cPKC domain structure is modular, consisting of an N-terminal pseudosubstrate peptide, two inhibitory domains (C1A and C1B), a targeting domain (C2), and a kinase domain. Mature, cytoplasmic cPKCs are inactive until they are switched on by a multistep activation reaction that occurs largely on the plasma membrane surface. Often, this activation begins with a cytoplasmic Ca(2+) signal that triggers C2 domain targeting to the plasma membrane where it binds phosphatidylserine (PS) and phosphatidylinositol 4,5-bisphosphate (PIP2). Subsequently, the appearance of the signaling lipid diacylglycerol (DAG) activates the membrane-bound enzyme by recruiting the inhibitory pseudosubstrate and one or both C1 domains away from the kinase domain. To further investigate this mechanism, this study has utilized single-molecule total internal reflection fluorescence microscopy (TIRFM) to quantitate the binding and lateral diffusion of full-length PKC? and fragments missing specific domain(s) on supported lipid bilayers. Lipid binding events, and events during which additional protein is inserted into the bilayer, were detected by their effects on the equilibrium bound particle density and the two-dimensional diffusion rate. In addition to the previously proposed activation steps, the findings reveal a major, undescribed, kinase-inactive intermediate. On bilayers containing PS or PS and PIP2, full-length PKC? first docks to the membrane via its C2 domain, and then its C1A domain embeds itself in the bilayer even before DAG appears. The resulting pre-DAG intermediate with membrane-bound C1A and C2 domains is the predominant state of PKC? while it awaits the DAG signal. The newly detected, membrane-embedded C1A domain of this pre-DAG intermediate confers multiple useful features, including enhanced membrane affinity and longer bound state lifetime. The findings also identify the key molecular step in kinase activation: because C1A is already membrane-embedded in the kinase off state, recruitment of C1B to the bilayer by DAG or phorbol ester is the key regulatory event that stabilizes the kinase on state. More broadly, this study illustrates the power of single-molecule methods in elucidating the activation mechanisms and hidden regulatory states of membrane-bound signaling proteins.