Light causes a rapid, 1.7-fold increase in cyclic GMP concentration in intact squid retinas (Johnson et al. (1986]. To determine whether light-induced changes in cyclic GMP concentration result from activation of guanylate cyclase, we have studied the regulation of guanylate cyclase activity in squid (Loligo pealei) photoreceptors. The enzyme is membrane-associated and activity is enhanced by the detergents Triton X-100 or digitonin. The enzyme requires divalent cations, Mn2+ being preferred over Mg2+. The dependence of enzyme activity on the MnGTP concentration deviates from simple Michaelis-Menten kinetics. Under conditions where a light-induced binding of GTP to the guanine nucleotide regulatory protein can be observed, no light-induced change in guanylate cyclase could be detected.