The subcellular distributions of acidic (pH 4.5) and neutral (pH 7.5) longchain triacylglycerol lipases (glycerol ester hydrolase, EC 3.1.1.3) of pig liver have been determined. The distribution of the acidic lipase closely paralleled that of the lysosomal marker enzyme, cathepsin D. Approx. 60% of the neutral lipolytic activity resided in the soluble fraction;the distribution of this activity failed to parallel that of marker enzymes for mitochondria, lysosomes, microsomes, or plasma membranes. A method has been developed for purification of the neutral lipase from the soluble fraction by ultracentrifugation. An approximate 90-fold purification was achieved, with recovery of 16% of the initial activity. The partially purified neutral lipase exhibited a pH optimum between 7.25 and 7.5. It required 30 mM emulsified triolein for optimal activity and ceased to liberate fatty acids after 30 min of incubation. The enzymatic activity was destroyed by heating at 60 degrees C. Neutral lipase was inhibited by sodium deoxycholate, Triton X-100 and iodoacetamide. The activity was not inhibited by sodium taurocholate, EDTA, heparin and diethyl-p-nitrophenyl phosphate. Neutral lipase failed to exhibit activity in assay systems specific for lipoprotein lipase, monoolein hydrolase, tributyrinase, and methyl butyrate esterase and showed little or no capacity to hydrolyze chyle chylomicrons or plasma very low density lipoproteins. It is suggested that the function of neutral lipase may be to supply the liver with fatty acids liberated from endogenously synthesized or stored triacylglycerols.