Phosphoinositide plays a critical role not only in generating second messengers, such as inositol 1,4,5-trisphosphate and diacylglycerol, but also in modulating a variety of cellular functions including cytoskeletal organization and membrane trafficking. Many inositol lipid kinases and phosphatases appear to regulate the concentration of a variety of phosphoinositides in a specific area, thereby inducing spatial and temporal changes in their availability. For example, local concentration changes in phosphatidylinositol 4,5-bisphosphate (PI(4,5)P(2)) in response to extracellular stimuli cause the reorganization of actin filaments and a change in cell shape. PI(4,5)P(2) uncaps the barbed end of actin filaments and increases actin nucleation by modulating a variety of actin regulatory proteins, leading to de novo actin polymerization. PI(4,5)P(2) also plays a key role in membrane trafficking processes. In endocytosis, PI(4,5)P(2) targets clathrin-associated proteins to endocytic vesicles, leading to clathrin-coated pit formation. On the contrary, PI(4,5)P(2) must be dephosphorylated when they shed clathrin coats to fuse endosome. Thus, through regulating actin cytoskeleton organization and membrane trafficking, phosphoinositides play crucial roles in a variety of cell functions such as growth, polarity, movement, and pattern formation.