Acyl-CoA: lysophosphatidylcholine, acyl-CoA: lysophosphatidylethanolamine, and lysophosphatidylcholine:lysophosphatidylcholine acyltransferases were investigated using subcellular fractions derived from adult rat type II pneumocytes in primary culture. Acyl-CoA:lysophospholipid acyltransferase activities were determined to be microsomal, while lysophosphatidylcholine:lysophosphatidylcholine acyltransferase activity was found to be cytosolic. Total palmitoyl CoA:lysophosphatidylcholine acyltransferase activity was 30-fold greater than lysophosphatidylcholine:lysophosphatidylcholine acyltransferase activity, indicating that the former enzyme is more important in the synthesis of dipalmitoyl phosphatidylcholine. Palmitoyl-CoA and oleoyl-CoA lysophosphatidylcholine acyltransferase activities were approximately equal under optimal substrate conditions. Specific activities of the enzyme using arachidoyl-CoA and arachidonoyl-CoA were 46% and 18%, respectively, of those with palmitoyl-CoA. Acyl-CoA:lysophosphatidylethanolamine acyltransferase showed a preference for palmitoyl-CoA as opposed to oleoyl-CoA under optimal conditions. However, when equimolar concentrations of either palmitoyl-CoA and oleoyl-CoA or palmitoyl-CoA and arachidoyl-CoA were assayed together, the relative utilization of the two substrates was found to be dependent on total acyl-CoA concentration. At higher concentrations, the incorporation of palmitoyl-CoA into phosphatidylcholine was less than other acyl-CoAs. However, at lower concentrations palmitoyl-CoA was utilized quite selectively. Whole lung microsomes did not show as marked a preference for palmitoyl-CoA as did type II pneumocyte microsomes under these same conditions. In similar experiments, low total acyl-CoA concentrations produced greater incorporation of oleoyl-CoA into phosphatidylethanolamine. For both enzymes total activity at the lowest concentrations used was at least 45% that at optimal conditions. This demonstrates that the type II pneumocyte acyltransferase system(s) can selectively utilize palmitoyl-CoA. No evidence for direct exchange of palmitoyl-CoA with 1-saturated-2-unsaturated phosphatidylcholine in subcellular fractions from type II pneumocytes was found.