Abstract In experimental rat liver perfusion we observed net production of free acetate accompanied by accelerated ketogenesis with long-chain fatty acids. Mitochondrial acetyl-CoA hydrolase, responsible for the production of free acetate, was found to be inhibited by the free form of CoA in a competitive manner and activated by reduced nicotinamide adenine dinucleotide (NADH). The conditions under which the ketogenesis was accelerated favored activation of the hydrolase by dropping free CoA and elevating NADH levels. Free acetate was barely metabolized in the liver because of low affinity, high K m, of acetyl coenzyme A (acetyl-CoA) synthetase for acetate. Therefore, infused ethanol was oxidized only to acetate, which was entirely excreted into the perfusate. The acetyl-CoA synthetase in the heart mitochondria was much lower in K m than it was in the liver, thus the heart mitochondria was capable of oxidizing free acetate as fast as other respiratory substrates, such as succinate. These results indicate that rat liver produces free acetate as a byproduct of ketogenesis and may supply free acetate, as in the case of ketone bodies, to extrahepatic tissues as fuel.