Abstract The effect of chemical modification of bile acid:CoA ligase on its enzymatic activity was examined. Reagents which modify tyrosine and carboxyl groups did not affect the activity of either the purified enzyme or the enzyme in its native microsomal environment. The modification of arginine residues with either diacetyl or phenylglyoxal resulted in a loss of activity for both the purified and microsomal forms of the enzyme. ATP was able to protect the enzyme from inactivation. Neither cholate nor CoA were able to alter the time-course of inactivation. The sulfhydryl reagent N-ethylmaleimide (MalNEt) produced a biphasic effect on both the purified and microsomal forms of the enzyme. At short reaction times ligase activity increased, but further reaction lead to nearly complete inactivation. With the purified enzyme, ATP increased the extent of activation by MalNEt and decreased the rate of inactivation. With microsomes, ATP did not affect the extent of activation by MalNEt, but did slow the rat of inactivation. For both the purified and microsomal forms cholate provided no protection. Treatment of both forms of the enzyme with the sulfhydryl reagent iodoacetic acid produced a similar biphasic activation/inactivation of the ligase. It was hypothesized that modification of a fast-reacting cysteine leads to activation while a slower-reacting cysteine leads to inactivation. This latter cysteine appeared to be in the ATP-binding site on the enzyme.