Generation of arachidonic acid by the ubiquitously expressed cytosolic phospholipase A₂ (PLA₂) has a fundamental role in the regulation of cellular homeostasis, inflammation and tumorigenesis. Here we report that cytosolic PLA₂ is a negative regulator of growth, specifically of striated muscle. We find that normal growth of skeletal muscle, as well as normal and pathologic stress-induced hypertrophic growth of the heart, are exaggerated in Pla2g4a^−/− mice, which lack the gene encoding cytosolic PLA₂. The mechanism underlying this phenotype is that cytosolic PLA₂ negatively regulates insulin-like growth factor (IGF)-1 signaling. Absence of cytosolic PLA₂ leads to sustained activation of the IGF-1 pathway, which results from the failure of 3-phosphoinositide-dependent protein kinase (PDK)-1 to recruit and phosphorylate protein kinase C (PKC)-ζ, a negative regulator of IGF-1 signaling. Arachidonic acid restores activation of PKC-ζ, correcting the exaggerated IGF-1 signaling. These results indicate that cytosolic PLA₂ and arachidonic acid regulate striated muscle growth by modulating multiple growth-regulatory pathways.