Calcium-independent phospholipase A(2)γ (iPLA(2)γ) (PNPLA8) is the predominant phospholipase activity in mammalian mitochondria. However, the chemical mechanisms that regulate its activity are unknown. Here, we utilize iPLA(2)γ gain of function and loss of function genetic models to demonstrate the robust activation of iPLA(2)γ in murine myocardial mitochondria by Ca(2+) or Mg(2+) ions. Calcium ion stimulated the production of 2-arachidonoyl-lysophosphatidylcholine (2-AA-LPC) from 1-palmitoyl-2-[(14)C]arachidonoyl-sn-glycero-3-phosphocholine during incubations with wild-type heart mitochondrial homogenates. Furthermore, incubation of mitochondrial homogenates from transgenic myocardium expressing iPLA(2)γ resulted in 13- and 25-fold increases in the initial rate of radiolabeled 2-AA-LPC and arachidonic acid (AA) production, respectively, in the presence of calcium ion. Mass spectrometric analysis of the products of calcium-activated hydrolysis of endogenous mitochondrial phospholipids in transgenic iPLA(2)γ mitochondria revealed the robust production of AA, 2-AA-LPC, and 2-docosahexaenoyl-LPC that was over 10-fold greater than wild-type mitochondria. The mechanism-based inhibitor (R)-(E)-6-(bromomethylene)-3-(1-naphthalenyl)-2H-tetrahydropyran-2-one (BEL) (iPLA(2)γ selective), but not its enantiomer, (S)-BEL (iPLA(2)β selective) or pyrrolidine (cytosolic PLA(2)α selective), markedly attenuated Ca(2+)-dependent fatty acid release and polyunsaturated LPC production. Moreover, Ca(2+)-induced iPLA(2)γ activation was accompanied by the production of downstream eicosanoid metabolites that were nearly completely ablated by (R)-BEL or by genetic ablation of iPLA(2)γ. Intriguingly, Ca(2+)-induced iPLA(2)γ activation was completely inhibited by long-chain acyl-CoA (IC(50) ∼20 μm) as well as by a nonhydrolyzable acyl-CoA thioether analog. Collectively, these results demonstrate that mitochondrial iPLA(2)γ is activated by divalent cations and inhibited by acyl-CoA modulating the generation of biologically active metabolites that regulate mitochondrial bioenergetic and signaling functions.