We have shown that a microbial cholic acid catabolite (4R)-4-(2,3,4,6,6a beta,7,8,9,9a alpha,9b beta-decahydro-6a beta-methyl-3-oxo- 1H-cyclopenta[f]quinolin-7 beta-yl)valeric acid (DCQVA), is a potent peroxisome proliferator. In this paper a possible key stage in DCQVA metabolism, the activation of DCQVA to its CoA ester, has been investigated in rat liver microsomes and particulate fractions. The microsomal reaction was dependent on CoA, ATP, DCQVA (0.2-1 mM) and protein content. The reaction was decreased by storage at 4 degrees C, preincubation of microsomes at 37 degrees C for 5 min, or inclusion of Triton X-100 in the reaction mixture. Such treatments also enhanced generation of long-chain fatty acyl-CoAs, as determined by h.p.l.c. analysis. The same effect was caused by exposing the microsomes to phospholipase A2, suggesting that endogenous fatty acids may compete with DCQVA for esterification with CoA. Subcellular fractionation of rat liver demonstrated that the activity of DCQVA-CoA synthesis was localized predominantly in the microsomal fraction, in contrast to long-chain fatty acyl-CoA synthetase, which was distributed among all particulate fractions. Administration of clofibrate of rats did not affect the distribution of DCQVA-CoA synthesis activity. In contrast to a 2-fold induction of long-chain fatty acyl-CoA synthetase by clofibrate treatment, the activity of DCQVA-CoA synthesis in the microsomal fraction decreased by 80%. These results suggest that DCQVA is activated by an enzyme distinct from long-chain fatty acyl-CoA synthetase. The resulting perturbation of fatty acid metabolism may be involved in the mechanism whereby DCQVA causes peroxisome proliferation.