Mammalian ether phospholipids are characterized by a glycero-ether linkage at the sn-1-position of the glycerol backbone. In humans this type of phospholipid species occurs mainly in the ethanolamine and choline phosphoglycerides comprising an estimated 15% of total phospholipids. The glycero-ether linkage is synthesized by replacement of the acyl chain in acyl-dihydroxyacetonephosphate by a long-chain alcohol that donates the oxygen for the ether linkage. Both the enzyme that forms acyl-dihydroxyacetone phosphate (see Chapter II of this volume) and the one that introduces the glycero-ether linkage. i.e. alkyl-dihydroxyacetonephosphate synthase, are located in peroxisomes. The deficiency of ether phospholipids in human inborn errors of metabolism, caused by defects in peroxisome biogenesis, has clearly delineated the indispensable role of peroxisomes in ether phospholipid synthesis. The most characteristic enzyme of ether lipid synthesis is alkyl-dihydroxyacetonephosphate synthase. Its discovery and some of its properties, including mechanistic studies, have been discussed in recent reviews. This review recapitulates these findings and focuses on the new insights into the structure and properties of the enzyme that have recently been obtained resulting from the purification and subsequent cloning and expression of the cDNA encoding this peroxisomal enzyme.