Rat aortic endothelial cells were found to contain both constitutive and lipopolysaccharide (LPS)-inducible arginase activity. Studies were performed to determine whether induction of nitric oxide synthase (NOS) by LPS and cytokines is accompanied by sufficient arginase induction to render arginine concentrations rate limiting for high-output NO production. Unactivated cells contained abundant arginase activity accompanied by continuous urea formation. LPS induced the formation of both inducible NOS (iNOS) and arginase, and this was accompanied by increased production of NO, citrulline, and urea. Immunoprecipitation experiments revealed the constitutive presence of arginase-I in both unactivated and LPS-activated cells and arginase-II induction by LPS. Arginase-I and iNOS were verified by reverse transcriptase-polymerase chain reaction. Induction of large amounts of iNOS by LPS plus several cytokines resulted in large quantities of NO, citrulline, and NG-hydroxy-L-arginine (NOHA), but urea production was markedly diminished. Decreased urea production was attributed to increased formation of NOHA, the precursor to NO and citrulline and a potent inhibitor of arginase-I activity with an inhibitory constant of 10-12 microM. Inhibition of iNOS activity by NG-methyl-L-arginine decreased NO and NOHA production and increased urea production. This study reveals for the first time that substantial arginase activity is present constitutively in rat aortic endothelial cells, a different isoform of arginase is induced by LPS, and intracellular arginase activity can be markedly inhibited during cytokine induction of iNOS because of NOHA formation. The inhibition of arginase activity that occurs by NOHA during marked iNOS induction may be a mechanism to ensure sufficient arginine availability for high-output production of NO.