The microsomal ethanol oxidizing system (MEOS), inducible by ethanol and acetone, oxidizes ethanol to acetaldehyde, which causes many toxic effects associated with excess ethanol. Recent studies reported that rat liver microsomes also oxidize acetaldehyde, thereby challenging the validity of the assessment of MEOS activity by measuring acetaldehyde production and suggesting that MEOS activity results in the accumulation not of acetaldehyde but, rather, of its less toxic metabolite, acetate. To address these issues, we compared both metabolic rates of ethanol and acetaldehyde and the effect of ethanol on the acetaldehyde metabolism. Liver microsomes were prepared from Sprague-Dawley rats induced either with acetone for 3 days or ethanol for 3 weeks. NADPH-dependent acetaldehyde (300 microM) metabolism was measured in two ways: (1) by detection of acetaldehyde disappearance by headspace gas chromatography, and (2) by assessment of acetaldehyde oxidation by liquid scintillation counting of acetate formed from [1,2-14C]acetaldehyde. Ethanol (50 mM) oxidation was measured by gas chromatography. In acetone- and ethanol-induced rat liver microsomes, the acetaldehyde disappearance (p < 0.0001) and oxidation (p < 0.0001) rates were both significantly increased. The rates of acetaldehyde oxidation paralleled those of p-nitrophenol hydroxylation (r = 0.974, p < 0.0001), with a Km of 82+/-14 microM and a Vmax of 4.8+/-0.5 nmol/min/mg protein in acetone-induced microsomes. Acetaldehyde disappearance in acetone-induced microsomes and acetaldehyde oxidation in acetone-induced and ethanol-induced microsomes were significantly lower than the corresponding ethanol oxidation, with rates (nmol/min/mg protein) of 4.6+/-0.6 versus 9.0+/-0.8 (p < 0.005), 4.4+/-0.3 versus 9.1+/-0.5 (p < 0.0005), and 14.0+/-0.9 versus 19.5+/-1.8 (p < 0.05), respectively. The presence of 50 mM ethanol decreased this metabolism to 0.9+/-0.3 (p < 0.005), 0.5+/-0.1 (p < 0.001), and 1.8+/-0.3 (p < 0.001), resulting in rates of acetaldehyde metabolism of only 9.8+/-3.2%, 6.0+/-0.5%, and 9.5+/-1.2% (respectively) of those of ethanol oxidation. In conclusion, rat liver microsomes oxidize acetaldehyde at much lower rates than ethanol, and this acetaldehyde metabolism is strikingly inhibited by ethanol. Accordingly, acetaldehyde formation provides an accurate assessment of MEOS activity. Furthermore, because acetaldehyde production vastly exceeds its oxidation, the net result of MEOS activity is the accumulation of this toxic metabolite.