Simple SummaryPalm fatty acid distillate is a by-product of palm oil refining. It is of both environmental and economic interest to include it in the diets of broiler chickens. However, its high saturation degree and acidity level limit its use. This study aimed to assess the effect of replacing soybean oil with increasing levels of palm fatty acid distillate on the utilization of fat by broilers. Dietary fat hydrolysis was mostly affected by the age of the bird and including palm fatty acid distillate mainly affected the absorption process. The replacement of soybean oil by palm fatty acid distillate reduced the total fat utilization, and in starter chicks delayed the site of fatty acid absorption. As the age increased, the digestibility of saturated fatty acids improved, and, above all, it improved the free fatty acid utilization. Therefore, the potential inclusion of palm fatty acid distillate for broiler feeds depends on the age of the bird. It would not be recommended to include this by-product in starter feeds. However, for the grower-finisher phase, blending palm fatty acid distillate with soybean oil (1:3, w/w) could be a suitable alternative, that does not have negative repercussions for either fatty acid absorption or growth performance.Palm fatty acid distillate (PFAD) is a by-product of palm oil (P) refining. Its use in chicken diets is a way to reduce the cost of feed and the environmental impact. Its low unsaturated:saturated fatty acid ratio (UFA:SFA) and its high free fatty acid (FFA) level could be partially counteracted by its blending with soybean oil (S). The objective was to assess the effect of replacing S with different levels of PFAD on lipid-class content and fatty acid (FA) digestibility along the intestinal tract and in the excreta of 11 and 35-day-old broiler chickens. Five experimental diets were prepared by supplementing a basal diet with S (S6), PFAD (PA6), two blends of them (S4-PA2 and S2-PA4), or P (P6) at 6%. Replacing S with PFAD did not affect performance parameters (p > 0.05) but negatively affected feed AME, FA digestibility, and FFA intestinal content (p < 0.05), especially in starter chicks. Including PFAD delayed total FA (TFA) absorption (p < 0.05) at 11 days, but at 35 days it did not affect the TFA absorption rate. The use of PFAD blended with S, when FFA ≤ 30% and UFA:SFA ≥ 2.6, led to adequate energy utilization in broiler grower-finisher diets.