Cultured chick retinal pigment epithelial cells phagocytosed polystyrene latex particles. The phagocytosis was inhibited very specifically by melatonin, which attained 50% inhibition at about 10(-16) M. Other indole compounds such as 5-methoxytryptophol, 5-hydroxytryptophol, 6-hydroxymelatonin, N-acetylserotonin, 5-methoxytryptamine and serotonin were also inhibitory although their effects were less than 1/10,000 that of melatonin. Possible retinal neurotransmitters, acetylcholine, gamma-aminobutyric acid, glycine, dopamine, aspartic acid and glutamic acid, had no or only a minimum inhibitory effect, and was also the case for prostaglandin D2, E2, F2 alpha, and I2. Taurine was not inhibitory at all. Among nucleotides, cyclic AMP specifically inhibited phagocytosis, giving 50% inhibition at about 10(-11) M. Melatonin inhibition was increased by copresence of isobutylmethylxanthine. Inhibition by either melatonin or cyclic AMP was reversed by dibutyryl cyclic GMP. The reversal was observed also with compounds which were expected to increase intracellular cyclic GMP. Prostaglandin D2 reversed inhibition in both cases, but its effect was incomplete and per se it had an inhibitory effect. Melatonin derivatives reversed inhibition by melatonin alone but not inhibition by cyclic AMP. Taurine efficiently reversed both kinds of inhibition. Other possible neurotransmitters were ineffective. Taurine was thus the most effective of these compounds. We suggest the following hypothetic control mechanism of phagocytic activity of the pigment epithelial cells: melatonin and cyclic AMP are intercellular and intracellular signals, respectively, of stopping phagocytosis, while taurine and cyclic GMP are intercellular and intracellular signals, respectively of cancelling this stop signal. Phagocytic activity of chick retinal pigment epithelial cells might be regulated by the concentration ratio of melatonin to taurine in the interphotoreceptor space.