Increases in weight have been associated with corresponding increases in insulin resistance in postmenopausal women. Although estrogen has significant impact on body fat and body fat distribution, the cellular mechanisms that influence this process are not yet known. We measured adipose tissue fatty acid (FA) storage and FA storage factors in 12 premenopausal and 11 postmenopausal women matched for age and body composition. Postmenopausal women had lower postprandial FA oxidation (indirect calorimetry), greater meal FA, and direct free FA (FFA) storage than premenopausal women, including two-fold greater meal FA storage in the femoral depot. The fed/fasted activities of adipose tissue lipoprotein lipase were not significantly different between premenopausal and postmenopausal women. In contrast, adipocyte acyl-CoA synthetase and diacylglycerol acyltransferase activities in postmenopausal women were significantly upregulated and were positively correlated with direct FFA storage rates. These findings suggest that the propensity for subcutaneous adipose tissue FA storage is increased in postmenopausal women, more so from changes in adipocyte FA storage factors than from adipose tissue lipoprotein lipase activity. Our results suggest that female sex steroids, most likely estrogen, have important effects on adipose tissue FA storage and FA oxidation that could promote fat gain in postmenopausal women.