Severe scaly lesions in the skin, especially in the feet and tail, of the rat were induced by feeding a diet deficient in essential fatty acids (EFA). Analysis of the fatty acids in skin lipids of these EFA-deficient rats showed a marked increase of monoenoic acids (16:1 and 18:1) and eicosatrienoic acid (20:3), with concomitant decreases of dienoic acid (18:2) and tetraenoic acid (20:4). Topical application of prostaglandin E(2) (PGE(2)) to the scaly lesions resulted in clearance of the lesions, but did not significantly alter the composition of fatty acids in the skin. Intraperitoneal injection of PGE(2) had no observable effect on the skin lesions. Furthermore, incubation of skin specimens from the EFA-deficient rats with (14)C-labeled glucose showed a 4-5-fold increase of incorporation of glucose carbon into lipid fractions, particularly the sterol esters, and a 3-4-fold increase in pentose cycle activity. Addition of PGE(2) to the incubation mixture resulted in approximately 70% inhibition of sterol ester biosynthesis by skin of the EFA-deficient rats. These results suggest that the effects of PGE(2) in clearing the scales may be associated with its inhibitory effect on abnormal sterol esterification in the skin of the EFA-deficient rats.