We have investigated the response of glucose and free fatty acid (FFA) kinetics and oxidation to betahydroxybutyrate (BOHB) infusion (30 mumol/kg X min) in both normal and Escherichia coli septicemic conscious dogs. In both the septic and control groups, experiments were performed in which hormone levels were allowed to change in response to the BOHB infusion, and in which the infusion of somatostatin, insulin, and glucagon were used to hold those hormone levels constant and sympathetic activity was blocked by the infusion of propranolol and phentolamine. In the nonseptic groups, the infusion of BOHB decreased both glucose production and FFA appearance (RaFFA) independent of the hormonal status. Glucose oxidation decreased in proportion to the decrease in production and uptake. FFA oxidation decreased only when hormones were controlled. In contrast, the infusion of BOHB in septic dogs did not suppress either glucose production or RaFFa, irrespective of the hormonal status. Substrate oxidation again corresponded to the rate of appearance of the substrate. We conclude that in normal dogs, ketones act directly as metabolic regulators to decrease the appearance of both glucose and FFA in the plasma, but do not directly affect the ability of the animal to oxidize these substrates. In sepsis, the normal regulatory actions of ketones appear to be lost.