The substrate specificity and the intraperoxisomal localization of alpha-hydroxyacid oxidase in rat liver has been investigated cytochemically by the cerium technique and biochemically with a luminometric assay. Rat liver is fixed by perfusion with a low concentration (0.25%) of glutaraldehyde and vibratome sections are incubated for 60 min at 37 degrees C in a medium containing 3 mM CeCl3, 100 mM NaN3 and 5 mM of an alpha-hydroxyacid in 0.1 M of one of the following buffers: Pipes, Mops, Na-cacodylate, Tris-maleate, all adjusted to pH 7.8. Ten different alpha-hydroxyacids with a chain length between 2 and 8 carbon atoms were tested. The best results were obtained with glycolic, argininic and L-alpha-isocaproic acids. These cytochemical findings were confirmed also biochemically using purified peroxisomal fractions isolated by gradient centrifugation in metrizamide. The pattern of the intraperoxisomal localization of the enzyme was influenced markedly by the type of buffer used for the cytochemical incubation. Whereas in the Tris-maleate medium both the cores and the matrix stained with the same intensity, with all other buffers the reaction in cores was more prominent. The staining of cores was abolished by pretreating sections in Tris-maleate (pH 7.8) or alkaline pyrophosphate buffers. These observations establish the substrate specificity of alpha-hydroxyacid oxidase in rat liver and demonstrate the delicate association of this enzyme with the crystalline cores and the matrix of peroxisomes in rat liver.