1,2-Diacyl-3-acetyl-sn-glycerols (ac-TAG) are unusual triacylglycerols that constitute the major storage lipid in the seeds of Euonymus alatus (Burning Bush). These ac-TAGs have long-chain acyl groups esterified at both the sn-1 and sn-2 positions of glycerol. Cell-free extracts of developing seeds of E. alatus contain both long-chain acyl-CoA and acetyl-CoA sn-1,2-diacylglycerol acyltransferase (DGAT) activity. We have isolated a gene from developing seeds of Euonymus alatus that shows a very high sequence similarity to the members of the DGAT1 gene family (i.e. related to acyl-CoA:cholesterol acyltransferases). This Euonymus DGAT1 gene, when expressed in wild type yeast, results in a 5-fold enhancement of long-chain triacylglycerol (lc-TAG) accumulation, as well as the appearance of low levels of ac-TAG. Hydrogenated ac-TAG molecular species were identified by gas chromatography-mass spectrometry. Microsomes isolated from this transformed yeast show diacylglycerol:acetyl-CoA acetyltransferase activity, which is about 40-fold higher than that measured in microsomes prepared from yeast transformed with the empty vector or with the Arabidopsis thaliana DGAT1 gene. The specific activity of this microsomal acetyltransferase activity is of the same order of magnitude as the microsomal long-chain DGAT activities measured for yeast lines transformed with the empty vector or either the Arabidopsis or Euonymus DGAT1 genes. Despite this, ac-TAG accumulation in yeast transformed with the Euonymus DGAT1 gene was very low (0.26% of lc-TAG), whereas lc-TAG accumulation was enhanced. Possible reasons for this anomaly are discussed. Expression of the Euonymus DGAT1-like gene in yeast lines where endogenous TAG synthesis has been deleted confirmed that the gene product has both long-chain acyl- and acetyltransferase activity.