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F asted dogs prepared with catheters in the femoral artery, portal vein, and hepatic vein and infused intravenously with palmitate-1-¹⁴C were used to estimate uptake of free fatty acids in liver and their conversion to major metabolic products secreted into hepatic venous blood. Animals were studied under ordinary conditions and when fat mobilization was increased abruptly by infusing norepinephrine or for a prolonged period by withdrawing insulin from depancreatized dogs. 80% of hepatic blood flow was assumed to be derived from the portal vein.Hepatic uptake was proportional to net outflow transport of plasma free fatty acids in the three groups and, in each, hepatic extraction fraction was about 25%. Since specific activity of free fatty acids entering and leaving the liver was equal and their composition was closely similar in the three sites sampled, it was concluded that palmitate is a representative tracer for free fatty acids entering the liver and that the liver does not release free fatty acids into the blood.In norepinephrine-infused dogs, the fraction of free fatty acids secreted in triglycerides (13%) was similar to that of control animals, so that transport of triglycerides was increased. In diabetic dogs no increased transport could be demonstrated since an average of only 2% of free fatty acids was converted to plasma triglyceride fatty acids; the hyperlipemia uniformly observed therefore appeared to result from defective removal of triglycerides from the blood.A similar fraction of free fatty acids was converted to ketones in normal and norepinephrine-infused dogs. This fraction was somewhat higher in diabetic animals and, in addition, a substantial quantity of ketones was derived from unlabeled precursors. Fractional conversion of free fatty acids to CO₂ was similar in normal and norepinephrine-infused dogs, but reduced in the diabetics.