The Rnd proteins (Rnd1, Rnd2 and Rnd3/RhoE) form a distinct branch of the Rho family of small GTPases. Altered Rnd3 expression causes changes in cytoskeletal organization and cell cycle progression. Rnd3 functions to decrease RhoA activity, but how Rnd3 itself is regulated to cause these changes is still under investigation. Unlike other Rho family proteins, Rnd3 is regulated not by GTP/GDP cycling, but at the level of expression and by post-translational modifications such as prenylation and phosphorylation. We show in the present study that, upon PKC (protein kinase C) agonist stimulation, Rnd3 undergoes an electrophoretic mobility shift and its subcellular localization becomes enriched at internal membranes. These changes are blocked by inhibition of conventional PKC isoforms and do not occur in PKCalpha-null cells or to a non-phosphorylatable mutant of Rnd3. We further show that PKCalpha directly phosphorylates Rnd3 in an in vitro kinase assay. Additionally, we provide evidence that the phosphorylation status of Rnd3 has a direct effect on its ability to block signalling from the Rho-ROCK (Rho-kinase) pathway. These results identify an additional mechanism of regulation and provide clarification of how Rnd3 modulates Rho signalling to alter cytoskeletal organization.