The effects of pancreatic hormones and cyclic AMP on long-chain fatty-acid metabolism were investigated in human hepatocytes isolated from 12 liver biopsy specimens and cultured for 4 days in an insulin-free medium. Glucagon (10−6 mol/L) increased endogenous ketone body production by 150%. This resulted from alterations in the partition of long-chain fatty acids from esterification toward oxidation. Glucagon or cyclic AMP enhanced (14C) oleate oxidation (basal = 45.8% ± 5.0%; glucagon = 66.8% ± 5.3%; cyclic AMP = 67.6% ± 5.0% of metabolized oleate) at the expense of oleate esterification. Insulin (10−7 mol/L) antagonized the glucagon-induced oleate oxidation. After 24 hr in basal culture conditions, the rate of lipogenesis decreased to the same low rate as in glucagon-treated cells. The presence of insulin did not restore a high rate of lipogenesis. These results are the first direct evidence of a control of ketone body production by glucagon in the human liver. (HEPATOLOGY 1991;13:1126–1130.)