The activation of acetyl-CoA carboxylase (measured in a crude supernatant fraction) caused by insulin treatment of adipocytes was completely unaffected by the addition of a large amount of highly purified protein phosphatase to the supernatant fraction. Under the same conditions the inhibition of acetyl-CoA carboxylase by adrenaline was totally reversed. Experiments with 32P-labelled adipocytes showed that insulin increased the total phosphorylation of acetyl-CoA carboxylase from 2.7 to 3.5 molecules of phosphate/240 kDa subunit, and confirmed that this increase was partially accounted for by phosphorylation within a specific peptide (the 'I-site' peptide). Protein phosphatase treatment of the crude supernatant fractions removed over 80% of the 32P radioactivity from the enzyme and removed all detectable radioactivity from the I-site peptide. The effect of insulin on acetyl-CoA carboxylase activity, but not the effect on phosphorylation, was lost on purification of the enzyme on avidin-Sepharose. The effect on enzyme activity was also lost if crude supernatant fractions were subjected to rapid gel filtration after treatment under conditions of high ionic strength, similar to those used in the avidin-Sepharose procedure. These results show that, although insulin does increase the phosphorylation of acetyl-CoA carboxylase at a specific site, this does not cause enzyme activation. They suggest instead that activation of the enzyme by insulin is mediated by a tightly bound low-Mr effector which dissociates from the enzyme at high ionic strength.