Type 2 diabetes, a major risk factor for atherosclerosis, is associated with a cluster of lipid risk factors, many of which can be mechanistically linked with underlying dysregulated fatty acid metabolism and elevated plasma non-esterified fatty acids (NEFA). Thus, we tested the hypothesis that elevated NEFA dysregulates lipid metabolism at the levels of lipid synthesis and gene expression in THP-1 monocyte derived macrophages (MDM). THP-1 MDM incubated with oleic acid (OA) and a BODIPY-conjugated NEFA, accumulate, respectively, intracellular inclusions that are positive for oil red O and BODIPY-labeling. Parallel studies with [(14)C]OA show dose-dependent accumulation of intracellular (14)C-labeled neutral lipid, almost exclusively as triglyceride; the rate of [(3)H]OA uptake increases as THP-1 MDM convert to foam cells. Preincubation of THP-1 MDM with higher concentrations of OA (1.8mM versus 0.2mM) was associated with enhanced uptake of Ac-LDL, and increased expression of adipocyte fatty acid binding protein, FAT/CD36, and cyclooxygenase-2 (COX-2); COX-2 mass and activity also increased. These observations suggest a mechanistic link between sustained elevations in albumin-bound NEFA and foam cell formation that may be mediated by enhanced adipogenesis, increased uptake of modified LDL, and upregulated formation of eicosanoids, which may be proinflammatory.