In previous studies we described enzyme(s) from Escherichia coli that transfer two 3-deoxy-D-manno-octulosonate (KDO) residues from two CMP-KDO molecules to a tetraacyldisaccharide-1,4'-bis-phosphate precursor of lipid A, termed lipid IVA (Brozek, K. A., Hosaka, K., Robertson, A. D., and Raetz, C. R. H. (1989) J. Biol. Chem. 264, 6956-6966). The product, designated (KDO)2-IVA, can be prepared in milligram quantities and/or radiolabeled with 32P at position 4' of the IVA moiety. We now demonstrate the presence of enzymes in E. coli extracts that transfer laurate and/or myristate residues from lauroyl or myristoyl-acyl carrier protein (ACP) to (KDO)2-IVA. Thioesters of coenzyme A are not substrates. The cytosolic fraction catalyzes rapid acylation with lauroyl-ACP, but not with myristoyl, R-3-hydroxymyristoyl, palmitoyl, or palmitoleoyl-ACP. The membrane fraction transfers both laurate and myristate to (KDO)2-IVA. Evidence for the enzymatic acylation of (KDO)2-IVA is provided by (a) conversion of [4'-32P](KDO)2-IVA to more rapidly migrating products in the presence of the appropriate acyl-ACP, (b) incorporation of [1-14C]laurate or [1-14C]myristate into these metabolites in the presence of (KDO)2-IVA, (c) fast atom bombardment-mass spectrometry, and (d) 1H NMR spectroscopy. At protein concentrations less than 0.5 mg/ml, the acylation of (KDO)2-IVA by the cytoplasmic fraction is absolutely dependent upon the addition of exogenous acyl-ACP. These acyltransferases cannot utilize lipid IVA as a substrate, demonstrating that they possess novel KDO recognition domains. The unusual substrate specificity of these enzymes provides compelling evidence for their involvement in lipid A biosynthesis. Depending on the conditions it is possible to acylate (KDO)2-IVA with 1 or 2 lauroyl residues, with 1 or 2 myristoyl residues, or with 1 of each.