Classical protein kinase C (PKC) family members are activated by the binding of various ligands to one of several cysteine-rich domains of the enzyme. The natural agonist, diacylglycerol (DAG), and the natural product superagonist, phorbol dibutyrate (PDB), activate the enzyme to produce wide-ranging physiological effects. The second cysteine-rich (Cys2) domain of rat brain PKC-gamma was expressed and labeled with 15N and 13C, and the solution structure was determined to high resolution using multidimensional heteronuclear NMR methods. The phorbol binding site was identified by titrating this domain with phorbol-12,13-dibutyrate (PDB) in the presence of organic cosolvents. Titrations of this domain with lipid micelles, in the absence and presence of phorbols, indicate selective broadening of some resonances. The observed behavior indicates conformational exchange between bound and free states upon protein-micelle interaction. The data also suggest that half of the domain, including the phorbol site and one of the zinc sites, is capable of inserting into membranes.