The regulation of intestinal acyl-CoA: cholesterol acyltransferase was investigated by dietary manipulation. Rabbits were fed the following diets: normal rabbit chow, 10% safflower oil, safflower oil plus 1% cholesterol, coconut oil plus 1% cholesterol, or cholestyramine. Acyl-CoA: cholesterol acyltransferase activity was increased in intestinal microsomes from animals fed safflower oil but not from animals fed coconut oil. Both diets containing cholesterol increased acyl-CoA: cholesterol acyltransferase activity; however, the safflower oil plus cholesterol diet was a more potent stimulator than coconut oil plus cholesterol. Cholestyramine decreased microsomal acyl-CoA: cholesterol acyltransferase activity. The different diets significantly modified microsomal lipid content in these groups. The two cholesterol diets resulted in equal increments in microsomal cholesterol. Microsomal cholesterol was unchanged in animals on the safflower oil diet; however, coconut oil and cholestyramine decreased the cholesterol content. Linoleic acid content increased in microsomes from animals on both the safflower oil-containing diets. Myristic acid accumulated and linoleic acid was decreased in microsomes from animals on both diets containing coconut oil. Subcellular fractionation of the intestine yielded a 4-fold enhancement of acyl-CoA: cholesterol acyltransferase activity in the rough endoplasmic reticulum. The lipid modifications and the subsequent changes in acyl-CoA: cholesterol acyltransferase activity in the rough endoplasmic reticulum from animals on normal, safflower oil, and safflower oil plus cholesterol diets paralleled that observed in the crude microsomal preparations. The changes in acyl-CoA: cholesterol acyltransferase activity observed with the different diets were not due to changes in microsomal fatty acyl-CoA pool size. It is concluded that dietary manipulation can alter microsomal lipid content. Microsomal fat saturation, independent of microsomal cholesterol content, regulates intestinal acyl-CoA: cholesterol acyltransferase and modifies the stimulatory effect of exogenous cholesterol on this enzyme.