Binding characteristics of phosphatidylinositol-specific phospholipase C (PI-PLC) from Bacillus cereus binding to the phospholipid-water interface were determined by spectroscopic methods and correlated with PI-PLC's catalytic properties. Binding of the enzyme to micelles and bilayers of zwitterionic phosphocholines is accompanied by an increase in the fluorescence emission from tryptophan, whereas a decrease in the emission is observed with synthetic anionic lipids containing a phosphomethanol head group. A similar decrease in the tryptophan emission is observed with phosphatidylinositol (PI) analogues containing the phospho-D-1-myo-inositol head group, but not with the enantiomeric L-1-myo-inositol. In covesicles of PI and phosphatidylcholine (PC), the rate of cleavage of PI is reduced because, as a neutral diluent, PC effectively reduces the surface concentration of PI that the bound enzyme "sees" in the interface. This permits determination of the interfacial Michaelis constant (KM*) as 0.26 mol fraction for PI as substrate. On the other hand, ditetradecylglycerophosphomethanol (DTPM) acts as a kinetic competitive inhibitor in the covesicles. The spectroscopic and catalytic activity data taken together show that PI-PLC binds to the interface of aqueous dispersions of phospholipids with an apparent Kd (in terms of the lipid monomers) of about 10-50 microM. However, only lipids with an anionic head group, such as phosphomethanol and phospho-D-1-myo-inositol, are able to bind as single molecules into the active site of the enzyme at the interface. Enantiomeric phospho-L-1-myo-inositol or the zwitterionic phosphocholine head group has little affinity for the enzyme at the interface. Thus, PI-PLC appears to obey the two-stage, Michaelis-Menten adaptation of interfacial catalysis, according to which the binding of the enzyme to the interface precedes the steps of the catalytic turnover at the interface. Limit estimates suggest that on PI or PI/PC vesicles the catalysis occurs in the "scooting" mode with a moderate processivity. DTPM vesicles also inhibit the activity of PI-PLC toward the synthetic water-soluble substrate myo-inositol 1-(4-nitrophenyl phosphate), but the activity is enhanced severalfold in the presence of vesicles of zwitterionic phosphatidylcholine. Several possible explanations of this interfacial activation are considered within the general context of the kinetic scheme for interfacial catalysis. The kinetic results for the action of PI-PLC bound to vesicles are consistent with a model in which the interface acts as an "allosteric" effector of the catalytic rate constant, kcat, without affecting the substrate binding.