Cell chemotaxis, such as migration of fibroblasts towards growth factors during development and wound healing, requires precise spatial coordination of signalling events. Phosphoinositides and signalling enzymes involved in their generation and hydrolysis have been implicated in regulation of chemotaxis; however, the role and importance of specific components remain poorly understood. Here, we demonstrate that phospholipase C epsilon (PLCe) contributes to fibroblast chemotaxis towards platelet-derived growth factor (PDGF-BB). Using PLCe1 null fibroblasts we show that cells deficient in PLCe have greatly reduced directionality towards PDGF-BB without detrimental effect on their basal ability to migrate. Furthermore, we show that in intact fibroblasts, signalling events, such as activation of Rac, are spatially compromised by the absence of PLCe that affects the ability of cells to enlarge their protrusions in the direction of the chemoattractant. By further application of live cell imaging and the use of FRET-based biosensors, we show that generation of Ins(1,4,5)P(3) and recruitment of PLCe are most pronounced in protrusions responding to the PDGF-BB gradient. Furthermore, the phospholipase C activity of PLCe is critical for its role in chemotaxis, consistent with the importance of Ins(1,4,5)P(3) generation and sustained calcium responses in this process. As PLCe has extensive signalling connectivity, using transgenic fibroblasts we ruled out its activation by direct binding to Ras or Rap GTPases, and suggest instead new unexpected links for PLCe in the context of chemotaxis.