We have examined the mechanism by which extracellular free fatty acids regulate fatty acid biosynthesis in Ehrlich ascites tumor cells. De novo biosynthesis in intact cells was inhibited by stearate greater than oleate greater than palmitate greater than linoleate. The amount of citrate and long chain acyl-CoA in the cells was not changed appreciably by the addition of free fatty acids to the incubation medium, indicating than free fatty acids do not regulate fatty acid biosynthesis by changing the total intracellular content of these metabolites. By measuring the incorporation of labeled free fatty acids into acyl-CoA, however, it was determined that the fatty acid composition of the acyl-CoA poolwas changed dramatically to reflect the composition of the exogenous free fatty acids. The relative inhibitory effects of different free fatty acids appear to depend on the ability of their acyl-CoA derivatives to regulate acyl-CoA carboxylase activity. The acyl-CoA concentration needed to produce 50% inhibition of purified Ehrlich cell carboxylase was found to be 0.68 mum for stearoyl-CoA, 1.6 mum for oleoyl-CoA, 2.2 mum for palmitoyl-CoA, 23 mum for myristoyl-CoA, 30 mum for lauroyl-CoA, and 37 mum for linoleoyl-CoA. In contrast to their effects on de novo synthesis, all of the free fatty acids added except stearate stimulated chain elongation in intact cells. Microsomal chain elongation, the major system for elongation in Ehrlich cells, also was regulated by the composition of the cellular acyl-CoA pool. Lauroyl-CoA, myristoyl-CoA, and palmitoyl-CoA were good substrates for elongation by isolated microsomes; oleoyl-CoA, and linoleoyl-CoA were intermediate; and stearoyl-CoA was a very poor substrate. We conclude that free fatty acids regulate fatty acid biosynthesis by changing the composition of the cellular acyl-CoA pool. These changes control the rate of malonyl-CoA production and, because of the acyl-CoA substrate specificity of the microsomal elongation system, modulate the amount of malonyl-CoA used for chain elongation.