Fatty acid ethyl esters (FAEE), esterification products of fatty acids and ethanol, are in use as fatty acid supplements, but they also have been implicated as toxic mediators of ethanol ingestion. We hypothesized that hydrolysis of orally ingested FAEE occurs in the gastrointestinal (GI) tract and in the blood to explain their apparent lack of toxicity. To study the in vivo inactivation of FAEE by hydrolysis to free fatty acids and ethanol, we assessed the hydrolysis of FAEE administered as an oil directly into the rat stomach and when injected within the core of low-density lipoprotein particles into the circulation of rats. Our studies demonstrate that FAEE are rapidly degraded to free fatty acids and ethanol in the GI tract at the level of the duodenum with limited hydrolysis in the stomach. In addition, FAEE are rapidly degraded in the circulation, with a half-life of only 58 s. Thus the degradation of FAEE in the GI tract and in the blood provides an explanation for the apparent lack of toxicity of orally ingested FAEE.