1. Renal metabolism of paracetamol has been studied in the isolated perfused rat kidney. 2. The major metabolites of paracetamol normally observed in vivo were present in low concentrations in the urine of the isolated perfused rat kidney. 3. Paracetamol was bound covalently to kidney protein in a linear relationship to dose up to 31.9 mM paracetamol in the perfusate. 4. Using Michaelis-Menten kinetics, the apparent Km of 5.5 mM and Vmax of 139 nmol/h/g wet wt. for renal paracetamol oxidation were observed. 5. Concn. of paracetamol greater than 14.2 mM induced immediate diuresis and diminished sodium reabsorption. Lower concn. were without effect on function.