Pretreatment of cultured rat hepatocytes with dexamethasone markedly enhanced the acute cAMP response to glucagon, isoproterenol or forskolin. The effect of dexamethasone was apparent within 3-6 hr and was maximal after 20-30 hr. The amplification of the cAMP response to glucagon could also be produced by other glucocorticoids, with relative potency dexamethasone much greater than methylprednisolone greater than hydrocortisone. The increased cAMP response was associated with a reduced cAMP phosphodiesterase activity in cell lysates and a reduced effect of the phosphodiesterase inhibitor 3-isobutyl-1-methylxanthine in intact cells, indicating that the glucocorticoid pretreatment reduced cAMP degradation. However, the increase in response to glucagon in glucocorticoid-treated cells was relatively larger than the increase in forskolin response and also larger than the decrease in phosphodiesterase activity, suggesting that other factors in addition to down-regulation of phosphodiesterases was responsible for the effect. Cycloheximide abolished the difference in phosphodiesterase activity and cAMP response between dexamethasone-treated and control cells. The results suggest that the glucocorticoids increase the ability of hepatocytes to accumulate cAMP due to protein synthesis-dependent processes which at least in part involve reduced degradation of cAMP.