Rat liver polyribosomes may be acetylated in vivo utilizing [3-H]acetate as precursor and in vitro with [14-C]acetyl-CoA. The in vitro acetylation occurs almost completely in the amino terminal position while the in vivo acetylation (after correction for isotopic exchange and incorporation of tritium into nonacetyl positions of amino acids) was distributed equally between the amino terminal groups of a number of amino acids and the epsilon-amino groups of internal lysine residues. At least 50% of the labeled acetyl groups introduced in vivo as well as in vitro could be removed from polysomes as puromycin polypeptides or -peptidyl-tRNA. The acetylated polypeptides have been resolved by gel filtration into two components, one with an average molecular weight of 20,000 and the other of 4000-7000. The results presented indicate that the N-terminal acetylation of nascent growing polypeptides is a post initiation event that occurs on small peptides (40-70 amino acid residues) and depends on the presence of a polysome-bound acetyltransferase which differs from other cytoplasmic acetyltransferases which catalyze predominately the acetylation of internal amino groups of proteins.