Atypical protein kinase C¿ (PKC¿) is emerging as a mediator of differentiation. Here, we describe a novel role for PKC¿ in myogenic differentiation, demonstrating that PKC¿ activity is indispensable for differentiation of both C2C12 and mouse primary myoblasts. PKC¿ was found to be associated with and to regulate the Cdk5/p35 signaling complex, an essential factor for both neuronal and myogenic differentiation. Inhibition of PKC¿ activity prevented both myotube formation and simultaneous reorganization of the nestin intermediate filament cytoskeleton, which is known to be regulated by Cdk5 during myogenesis. p35, the Cdk5 activator, was shown to be a specific phosphorylation target of PKC¿. PKC¿-mediated phosphorylation of Ser-33 on p35 promoted calpain-mediated cleavage of p35 to its more active and stable fragment, p25. Strikingly, both calpain activation and the calpain-mediated cleavage of p35 were shown to be PKC¿-dependent in differentiating myoblasts. Overall, our results identify PKC¿ as a controller of myogenic differentiation by its regulation of the phosphorylation-dependent and calpain-mediated p35 cleavage, which is crucial for the amplification of the Cdk5 activity that is required during differentiation. © 2010 by The American Society for Cell Biology.