Isolated rabbit heart mitochondria oxidizing long-chain acylcarnitine accumulated β-hydroxy fatty acids when the NADH NAD ratio was increased by rotenone treatment. β-Hydroxystearate, -palmitate, and -myristate were measured by gas chromatography/mass spectrometry. The principal β-hydroxy fatty acids accumulated were n and n-2 carbon analogues of the substrate fatty acid; there were no n + 2β-hydroxy fatty acids. β-Hydroxy fatty acids accumulated initially as extra-mitochondrial acylcarnitines and later as extra-mitochondrial free fatty acids. l-Carnitine was necessary for β-hydroxy fatty acid accumulation. Acetate inhibited β-hydroxy fatty acid accumulation in a concentration-dependent manner. Terminal respiratory chain inhibition by cyanide sufficient to inhibit [1- 14C]palmitoyl-CoA oxidation to [ 14C]acid-soluble products by 85% did not cause β-hydroxy fatty acid accumulation even with NADH NAD ratios comparable to those obtained with rotenone treatment. However, β-hydroxy fatty acid accumulation during rotenone treatment was not prevented by cyanide. These data suggest that β-hydroxy fatty acid accumulation during mitochondrial fatty acid oxidation results from an imbalance between FAD-dependent generation and NAD-dependent oxidation of β-hydroxyacyl-CoA and is dependent upon trans-esterification with carnitine and extra-mitochondrial translocation by reversal of the carnitine-acyl transferase system.