The interaction of gluconeogenesis and fatty acid oxidation in isolated sheep hepatocytes was studied. Addition of tetradecylglycidic acid, an inhibitor of carnitine palmitoyltransferase I (EC 2.3.1.21), to isolated hepatocytes inhibited gluconeogenesis from a mixture of pyruvate plus lactate and from propionate alone. Inhibition constants for tetradecylglycidic acid on gluconeogenesis were 4.77 +/- 1.00 microM and 7.25 +/- 1.52 microM, respectively, for pyruvate plus lactate and for propionate as gluconeogenic substrates. The inhibition constants were not different. At the highest substrate concentrations examined, gluconeogenesis from pyruvate plus lactate and from propionate in the presence of 10 microM tetradecylglycidic acid was 47.3 and 41.4% of their respective controls. Similar to previous observations with butyrate, caproate addition inhibited gluconeogenesis from propionate by isolated hepatocytes and was unable to prevent inhibition of gluconeogenesis induced by tetradecylglycidic acid. Carnitine palmitoyltransferase I activity was lower in mitochondria isolated from hepatocytes preincubated with insulin than in control hepatocytes. The data suggest 1) that maximum rates of gluconeogenesis in isolated sheep hepatocytes from either pyruvate plus lactate or from propionate as gluconeogenic substrates require beta-oxidation, 2) that intermediates common to the metabolism of butyrate and caproate may be involved in the inhibition of propionate conversion to glucose by isolated sheep hepatocytes, and 3) that carnitine palmitoyltransferase I activity in isolated sheep hepatocytes can be modulated by insulin treatment.