1. 1. The effects of oestrogen and progesterone on synthesis and composition of lipids in the uterine epithelium were studied. 2. 2. Oestrogen treatment for up to 18hr resulted in an increased incorporation of [ 14C]acetate into all classes of lipids, but particularly into cholesterol. 3. 3. Progesterone treatment increased incorporation into all classes of lipids except cholesterol and completely inhibited the oestrogen-induced incorporation into cholesterol. We suggest that this may be the mechanism whereby progesterone blocks uterine epithelial cell proliferation. 4. 4. Oestrogen increased incorporation into all classes of phospholipids, and progesterone pretreatment inhibited the marked oestrogen-induced incorporation into phosphatidylinositol. 5. 5. Both oestrogen and progesterone, but particularly progesterone, increased the epithelial cell phospholipid to cholesterol ratio. 6. 6. Oestrogen induced changes in epithelial phospholipid fatty acyl composition: particularly marked was a time related reduction in 20: 4 which was inhibited by progesterone pretreatment to only a minor degree.