Palmitoyl-CoA synthetase activity in the microsomal fraction of rat liver was measured directly by palmitoyl-CoA production, and indirectly by converting the palmitoyl-CoA into palmitoylcarnitine under optimum conditions. Even in the latter system, palmitoyl-CoA accumulated. The rate of palmitoyl-CoA hydrolysis and the inhibition of palmitoyl-CoA synthetase by palmitoyl-CoA were each estimated to be less than 10% of the maximum rate of palmitoyl-CoA production. The concentration of palmitoyl-CoA present in the assay systems used for measuring palmitate esterification to glycerol phosphate and the activity of palmitoyl-CoA synthetase by using the carnitine-linked determination were measured. These concentrations were not altered by the addition of glycerol phosphate, or of carnitine plus carnitine palmitoyltransferase. The relationship between the activity of palmitoyl-CoA synthetase and the rate of glycerolipid synthesis was investigated. The latter activity was measured by using palmitoyl-CoA generated from palmitate, palmitoyl--AMP or palmitoylcarnitine. It is concluded that, at optimum substrate concentrations, the activity of glycerol phosphate acyltransferase is rate-limiting in the synthesis of phosphatidate by rat liver microsomal fractions. The implications of these results in the measurement of palmitoyl-CoA synthetase and in the control of glycerolipid synthesis are discussed.