Galactosyltransferase was purified from rat liver Golgi membranes. The Triton X-100, used to solubilize the enzyme was removed immediately prior to the lipid interaction studies. In lipid vesicles, prepared from a variety of phosphatidylcholines (PCs), including egg PC, DOPC, DMPC, DPPC and DSPC, the ability of the lipids to stimulate the enzyme decreased in the order egg PC greater than DOPC greater than DMPC greater than DPPC greater than DSPC, i.e. the lower the transition temperature (Tc) the greater the stimulation of the enzyme. A second, neutral lipid, phosphatidylethanolamine was used to permit a comparison of the effect of a different head group of the same net charge at neutral pH. The PEs included, egg PE, soy PE, Pl-PE, PE(PC) and DPPE in order of increasing Tc. The effect of the PEs was opposite to that of the PCs, i.e. the higher the Tc, the greater the stimulation of the enzyme. In fact egg PE and soy PE which have the lowest Tc values were inhibitory. Thus the modulation of the Golgi membrane galactosyltransferase by these lipids was different from that reported earlier for the bovine milk galactosyltransferase. The effects of two acidic lipids, egg phosphatidic acid (PA) and egg phosphatidylglycerol (PG) were studied also. Both totally inhibited the enzyme even at low concentrations of lipid, however, the PA was more effective than PG. In mixtures of neutral lipid (PC) and acidic lipid (PA or PG), the effect of the acidic lipid dominated. Even in the presence of excess PC, total inhibition of the enzyme was observed. It was concluded that the enzyme bound the acidic lipid preferentially to itself. The choice of the lipids allowed us to make several direct comparisons concerning the effect of the nature of the lipid head group on the activity of the enzyme. For example PE(PC), egg PA and egg PG would have fatty acid chains identical to egg PC since these three lipids are all prepared by modification of egg PC. As well, DPPE differs from DPPC only by nature of the head group. These comparisons indicated that not only the net charge but also chemical nature of the head group were important in the lipid modulation of Golgi galactosyltransferase.