1. The first dehydrogenation step of peroxisomal beta-oxidation involves the reduction of O2 to H2O2. Production rates of H2O2 and acetyl units by purified rat liver peroxisomes oxidizing palmitoyl-CoA were equal, indicating that H2O2 production is a reliable index for the release of acetyl units during peroxisomal fatty-acid oxidation. 2. Measurements of H2O2 and acid-soluble oxidation products during [1-14C]palmitoyl-CoA oxidation by purified peroxisomes revealed that the number of acetyl units released per molecule of palmitoyl-CoA oxidized rapidly decreased with increasing unbound palmitoyl-CoA concentrations. Structural damage to the peroxisomes caused by detergents or other treatments also decreased the number of acetyl units released. Under conditions where oxidation proceeded linearly with time the theoretical maximum of 5 acetyl units released per molecule of palmitoyl-CoA oxidized [Lazarow (1978) J. Biol. Chem. 253, 1522--1528] was never reached. 3. Expressed in terms of acetyl units produced and measured at low unbound-palmitoyl-CoA concentrations, mitochondrial oxidation was 10--20-fold higher than peroxisomal oxidation. 4. ATP stimulated peroxisomal palmitoyl-CoA oxidation approx. 2-fold. The ATP effect required the presence of Mg2+ and was lost when peroxisomal membranes were disrupted by Triton X-100 or high concentrations of unbound palmitoyl-CoA. 5. Disruption of peroxisomes by detergents, freeze--thawing, osmotic or mechanical treatment did not stimulate palmitoyl-CoA oxidation in the presence of ATP, indicating that peroxisomal fatty-acid-CoA oxidation was not latent. In the absence of ATP, Triton X-100 stimulated peroxisomal palmitoyl-CoA oxidation approx. 2-fold.