Preputial glands from rats, when incubated with C14 acetate showed a marked incorporation of C14 into squalene, a sterol precursor, and little into sterols. In this regard, the preputial glands differ from many other mammalian tissues which show incorporation of C14 mainly into a sterols and little into squalene. Human dermis, which contains sebaceous glands, is another mammalian tissue which shows preferential accumulation of the C14 into squalene. The mechanism of the difference in unknown, through it seems likely that factors necessary for conversion of squalene to sterols are missing in these tissues, or that an inhibitor of this reaction is present.