The study of ethanol effects on intracellular transport and membrane biogenesis in rat hepatocytes revealed that, during synthesis of transport vesicles, the cytosolic phosphatidylinositol 3-kinase incorporated into the membrane of Golgi transport vesicles and a portion of the vesicular phosphatidylinositol was phosphorylated to phosphatidylinositol 3-phosphate. Association of the enzyme with Golgi transport vesicles and the transport to the apical portion of the cell membrane was not affected by 0 to 120 mM ethanol, but was dependent on the presence of the p85 subunit of the phosphatidylinositol 3-kinase. In the presence of ATP-enriched cytosol and calcium ions, association of Golgi transport vesicles with the apical membrane was followed by phospholipase A2-specif ic hydrolysis of phosphatidylinositol 3-phosphate and incorporation of the transport vesicle membrane into the apical membrane. Association of Golgi transport vesicles with apical membranes was not affected by preincubation of the cell membrane or Golgi transport vesicles with 0 to 120 mM ethanol, but was inhibited when the p85 phosphatidylinositol 3-kinase was incorporated into the membrane before incubation with Golgi transport vesicles. The fusion of Golgi transport vesicles with the apical membrane and generation of lysophosphatidylinositol 3-phosphate and arachidonate was inhibited with EGTA or after depletion of ATP from cytosol. Results of these studies provide evidence that phosphatidylinositol 3-kinase and phospholipase Aj activities are crucial for the final step of exocytotic transport. The process consists of two stages. First, the p85 subunit of phosphatidylinositol 3-kinase is involved in the specific association of the vesicle with membrane receptor, and that is followed by phospholipase A2-specific lysophospholipid generation, perturbation of the membranes, and fusion of the transport vesicle membrane with the apical membrane. Addition of ethanol to the in vitro transport system decreased production of Golgi transport vesicles, but had no effect on their association with apical membrane or fusion with the membrane.