Megalomicin (MGM) is a macrolide antibiotic which has been demonstrated previously to cause an anomalous glycosylation of viral proteins. Here we show that MGM produces profound alterations on Golgi morphology and function. The addition of MGM at 50 microM for 1 h caused a dilation of the Golgi detected by immunofluorescence staining for medial- and trans-Golgi markers. The effect of MGM was clearly more intense on the trans-side of the Golgi, as evidenced in electron microscope preparations. The effect on Golgi morphology was reversible and correlated with an impairment of glycoprotein processing in the trans-Golgi. Thus, although the vesicular stomatitis virus G protein was processed in the presence of MGM to an endoglycosidase H-resistant form, it was poorly sialylated. The sialylation of cellular proteins was also inhibited, resulting in cells with low level of sialylation on the cell surface. However MGM did not inhibit the activities of the galactosyl- or sialyltransferase as measured in vitro. MGM inhibited cis- to medial-, and more strongly, medial- to trans-Golgi transport of vesicular stomatitis virus G protein in an in vitro system, suggesting that the impairment in glycoprotein maturation observed in vivo is the result of intra-Golgi transport inhibition.