In the current study, the cDNA and the genomic sequences of the arylacetamide deacetylase (AADA) gene in mice and rats have been determined. The AADA genes in the rat and mouse consist of five exons and have 2.4 kilobases of homologous promoter sequence upstream of the initiating ATG codon. The rodent gene sequences have been used to establish a real time quantitative R T-PCR assay to examine the tissue distribution and the regulation of AADA gene expression. AADA mRNA is expressed in hepatocytes, intestinal mucosal cells (probably enterocytes), the pancreas and also the adrenal gland. In mice, there is a diurnal rhythm in hepatic AADA mRNA concentration, with a maximum 10 h into the light (post-absorptive) phase. This diurnal regulation is attenuated in peroxisome proliferator-activated receptor α (PPARα) knockout mice. AADA mRNA concentration reaches a maximum shortly after PPARα mRNA in the diurnal cycle of normal mice. However, appropriately positioned PPAR elements were not detected in the promoter regions of the rodent genes. Intestinal but not hepatic AADA mRNA was increased following oral administration of the fibrate, Wy-14,643. This indicates that the diurnal regulation must be indirectly regulated by PPARα. In addition changes in AADA mRNA concentration were apparent under conditions which alter hepatic lipid secretion. The homology of AADA with hormone-sensitive lipase and the tissue distribution of AADA are consistent with the view that AADA plays a role in promoting the mobilization of lipids from intracellular stores and in the liver for assembling VLDL. This hypothesis is supported by parallel changes in AADA gene expression in animals with insulin-deficient diabetes and following treatment with orotic acid.