Palm oil has been treated by partial lipase hydrolysis and by interesterification with excess glycerol and the effects on the chemical and physical properties have been investigated. Lipase hydrolysis preferentially removes unsaturated acids and the neutral glycerides remaining after removal of the free fatty acids therefore have an increased solids content at 20°C. Both differential scanning calorimetry (d.s.c.) and X-ray examination show that the crystalline phases present above 20°C are more heterogeneous after lipase treatment. Interesterification results in a mixture of tri- and diglycerides with an increased solids content at 20°C and a marked tendency to form β phase crystals. Some potential practical applications are discussed.