Retinol and its metabolites (retinoids) are essential for growth and cell differentiation, particularly of epithelial tissue. Retinoids mediate most of their function via interaction with retinoid receptors (retinoic acid receptors and retinoid X receptors), which act as ligand-activated transcription factors controlling the expression of a number of target genes. We have investigated whether retinoid receptor ligands such as all-trans-retinoic acid (RA) are formed in the human intestinal epithelium from dietary vitamin A. We show here that retinol was metabolized to its active metabolite, all-trans-RA, by isolated cytosolic fractions of human small intestinal enterocytes and by human Caco-2 cells. All-trans-RA was metabolized by human small intestinal microsomes to at least two metabolites (all-trans-4-hydroxy-RA and all-trans-4-oxo-RA). When Caco-2 cells were incubated with all-trans-RA, at least three major polar metabolites (all-trans-4-hydroxy-RA, all-trans-4-oxo-RA, and 13-cis-4-hydroxy-RA) were identified by HPLC-UV. The cytochrome P450 (CYP) 1A1 inhibitor alpha-naphthoflavone inhibited the metabolism of all-trans-RA, whereas the CYP1A1 inducer beta-naphthoflavone induced the metabolism of all-trans-RA, suggesting that CYP1A1 is involved. The induction of CYP3A by rifampicin enhanced the metabolism, and the induction of all-trans-RA metabolism was also observed after preincubation of the cells with all-trans-RA. Liarozole almost completely inhibited the RA metabolism. The specific retinoic acid metabolizing CYP26 was induced after RA treatment in Caco-2 cells. It is concluded that in addition to CYP1A1 and CYP3A, CYP26 may be the main CYP enzyme responsible for the metabolism of all-trans-RA in enterocytes. Active ligands such as all-trans-RA are formed in intestinal epithelial cells.