We examined the enzymatic reaction responsible for the conversion of 1,4 butanediol to gamma-hydroxybutyric acid and the interaction of ethanol with this conversion in brain and liver. The enzyme responsible for this reaction in liver appears to be alcohol dehydrogenase. However, in both tissues, there was a competitive inhibition by ethanol of the conversion of 1,4 butanediol to gamma-hydroxybutyric acid with an apparent Ki of 6.5 X 10(-3) M in brain and 2.7 X 10(-3) M in liver. These findings may explain the potentiation of the behavioral effects of ethanol by 1,4 butanediol.