A highly purified rat liver protein kinase phosphorylates and inactivates acetyl‐CoA carboxylase, and causes rapid inactivation of microsomal HMG‐CoA reductase in the presence of MgATP. Both effects are stimulated in an identical manner by AMP, and are greatly reduced by prior treatment of the kinase with purified protein phosphatase. The dephosphorylated kinase can be reactivated in the presence of MgATP, apparently due to a distinct kinase kinase, and this reactivation is stimulated by nanomolar concentrations of palmitoyl‐CoA. These results show that a common, bicyclic protein kinase cascade can potently inactivate the regulatory enzymes of both fatty acid and cholesterol biosynthesis.