Oxytocin is synthesized in the granulosa-derived large cells of the ruminant corpus luteum from a gene which is dramatically up-regulated in the first few days after ovulation. In this work, the regulation of granulosa and luteal cells by prostaglandins and insulin (or insulin-like growth factor-I; IGF-I) has been explored by comparing their effects on oxytocin and progesterone production in cell culture. In granulosa cells, chronic exposure to insulin (17 nmol/l) stimulated luteinization as indicated by increased release of oxytocin and progesterone. Prostaglandin F2α (PGF2α) alone had little effect, but synergized with insulin (or IGF-I) to increase the release of both these hormones. In direct contrast, insulin-stimulated oxytocin production by luteal cells was inhibited by PGF2α. The half-maximal dose (EC50) for PGF2α action in both cell preparations was similar (10–100 nmol/l). Dose–response studies revealed that PGF2α increased the potency of insulin in granulosa cells (EC50 for insulin-stimulation of oxytocin release reduced from 141 to 13 nmol/l by 1 μmol PGF2α/l), but not in luteal cells. Insulin-stimulated oxytocin release from granulosa cells was also synergistically increased by PGE1, PGE2 and forskolin, suggesting this effect to be mediated by adenylate cyclase-coupled PGE receptors. The results reveal that the effects of prostaglandins on oxytocin release are dependent on both the developmental stage of the target tissue and on the presence of other regulators of cellular differentiation. Moreover, they suggest that the increase in responsiveness to insulin and IGF-I, which appears to accompany luteinization in the cow, may be an effect of prostaglandins produced locally during the peri-ovulatory period.