Of thirty-six species of metabolically active lichens taken mainly from Scottish coastal habitats, eight showed a capacity to reduce acetylene to ethylene. These were species of Collema Web., Lichina C. Ag., Peltigera Willd. and Placopsis Nyl. and all contained a blue-green alga as the primary or secondary phycobiont. Acetylene reduction rates were sometimes high in the field and showed marked diurnal and seasonal variations. Nitrogenase activity was higher in vegetative than in fruiting thalli of Peltigera rufescens, and in P. canina was higher nearer the apices of the thalli than in older parts. Of the environmental factors affecting fixation, desiccation was the most important, temperature was less important and the lichens, while requiring light, could continue to fix nitrogen in the dark for up to 18 hours (Lichina confinis) and 26 hours (Peltigera rufescens). The average percentage nitrogen contents of nitrogen-fixing lichens (2·20%) was significantly higher than the non-nitrogen-fixing lichens (0·83%). The maximum and mean rates of nitrogen fixation by P. rufescens were 38·1 and 4·1 μg N (mg N)-1 day-1 respectively. The corresponding values for Lichina confinis were 29·4 and 0·4.