CTP:choline-phosphate cytidylyltransferase is the principal rate-limiting enzyme required for surfactant phosphatidylcholine synthesis. We examined the in vitro effect of unsaturated fatty acids on the expression of the two cytosolic forms of this enzyme in fetal and adult rat lung. In the adult, a substantial portion of cytidylyltransferase is expressed as the active form (H form). By contrast, the majority of enzyme mass in the fetus is in an inactive form (L form). Oleic acid, or its esterified derivative, oleoyl-CoA, each stimulated the inactive form (L form) in vitro. However, the addition of oleoyl-CoA directly to the active form (H form) resulted in a dose-dependent decrease in H-form activity, suggesting feedback inhibition. Further, exposure of the enzyme in fetal lung cytosol to either fatty acid increased the mass of the enzyme, consistent with a shift from the inactive form (L form) to the active species (H form). These observations support a key role for unsaturated fatty acids in the developmental regulation of this enzyme.