1. The liver cells lose the major part of their carnitine during the commonly used isolation procedure by the collagenase-perfusion method. 2. The cells take up carnitine and the carnitine precursor butyrobetaine when these substances are added to the medium. The carnitine content of isolated liver cells can increase to about 15 mM with no apparent harm to the cells. 3. The data indicate the existence of a common carrier in the plasma membrane which mediates the uphill transport of both carnitine and butyrobetaine. The carrier has a high affinity for butyrobetaine (Km=0.5 mM) and a lower one for carnitine (Km=5.6 mM). 4. The intracellular butyrobetaine is hydroxylated to carnitine with a rate of approximately 0.33 mumol-g wet weight-1-h-1 which is sufficient to cover the turn over of carnitine in the whole rat. Carnitine is effectively esterified in the liver cells to acetylcarnitine and long-chain acylcarnitines. 5. Both carnitine and acetylcarnitine are released from the cells. The release of both compounds is probably physiological since it was found that acetylcarnitine constitutes a similar fraction of the total acid soluble carnitine both in the blood and liver of the intact rat.