Purified membrane vesicles isolated from sea urchin eggs form nuclear envelopes around sperm nuclei following GTP hydrolysis in the presence of cytosol. A low density subfraction of these vesicles (MV1), highly enriched in phosphatidylinositol (PtdIns), is required for nuclear envelope formation. Membrane fusion of MV1 with a second fraction that contributes most of the nuclear envelope can be initiated without GTP by an exogenous bacterial PtdIns-specific phospholipase C (PI-PLC) which hydrolyzes PtdIns to form diacylglycerides and inositol 1-phosphate. This PI-PLC hydrolyzes a subset of sea urchin membrane vesicle PtdIns into diglycerides enriched in long chain, polyunsaturated species as revealed by a novel liquid chromatography-mass spectrometry analysis. Large unilammelar vesicles (LUVs) enriched in PtdIns can substitute for MV1 in PI-PLC induced nuclear envelope formation. Moreover, MV1 prehydrolyzed with PI-PLC and washed to remove inositols leads to spontaneous nuclear envelope formation with MV2 without further PI-PLC treatment. LUVs enriched in diacylglycerol mimic prehydrolyzed MV1. These results indicate that production of membrane-destabilizing diglycerides in membranes enriched in PtdIns may facilitate membrane fusion in a natural membrane system and suggest that MV1, which binds only to two places on the sperm nucleus, may initiate fusion locally.At the end of each mitosis in eukaryotes, the nuclear envelope is typically reconstituted by membrane fusion, forming the nuclear compartment and segregating the chromosomes from the cytoplasm. A similar process encloses sperm chromatin in egg cytoplasm following fertilization. A number of studies emphasizing the role of proteins have addressed the mechanism of nuclear envelope assembly, many utilizing cell-free systems derived from eggs or somatic cells (1-4). However, relatively little attention has been paid to the essential role(s) played by membrane lipids in this process.Male pronuclear or somatic nuclear envelope formation involves binding of nuclear membrane precursors to the chromatin surface followed by fusion to create a double membrane enclosing the chromatin (1, 5-7). We have previously reported that envelope formation in a cell-free system derived from sea urchin eggs requires the fusion of three egg membrane vesicle populations and remnants of the sperm nuclear envelope at the tip and base of the conical nucleus (8 -10).One of the egg vesicle populations (MV1) 3 is particularly unusual. It is a low density fraction highly enriched in the membrane lipid phosphatidylinositol (PtdIns) (9, 11). MV1 binds at the tip and base of the sperm nucleus and is required for nuclear envelope formation, which can be induced by addition of GTP or a bacterial PtdIns-specific phospholipase C (PI-PLC) (9, 12). The endogenous sea urchin PI-PLC activity probably resembles a typical eukaryotic enzyme whose substrate is PtdIns(4,5)P 2 . GTP-initiated envelope formation is inhibited by GTP␥S and by the PI 3-kinase inhibitors, wortmannin and LY294002 (12, 13). Initi...