In the first part of the review the background to the discovery of the asymmetric synthesis of squalene from two molecules of farnesyl pyrophosphate and NADPH is described, then the stereochemistry of the overall reaction is summarized. The complexity of the biosynthesis of squalene by microsomal squalene synthetase demanded the existence of some intermediate(s) between farnesyl pyrophosphate and squalene. This demand was satisfied by the discovery of presqualene pyrophosphate, an optically active C30 substituted cyclopropylcarbinyl pyrophosphate, the absolute configuration of which at all three asymmetric centers of the cyclopropane ring was deduced to be R. Possible mechanisms for the biosynthesis of presqualene pyrophosphate and its reductive transformation into squalene are presented. In the second part of the review the nature of the enzyme is discussed. The question whether presqualene pyrophosphate is an obligate intermediate in the biosynthesis of squalene is examined, with the firm conclusion that it is. It is as yet uncertain whether the two half reactions of squalene synthesis, i.e. (i) 2 x farnesyl pyrophosphate leads to presqualene pyrophosphate; (ii) presqualene pyrophosphate + NADPH (NADH) leads to squalene, are catalyzed by one or two enzymes or by a large complex with two catalytic sites. Evidence is cited for the existence on the enzyme of two distinct binding sites with different affinities for the two farnesyl pyrophosphate molecules. The types of enzyme preparations available at present are described and types of experiments carried out with these are critically examined. The implications of the properties of a low molecular weight squalene synthetase solubilized with deoxycholate from microsomal membranes is discussed and a model for the enzyme in an organized membrane structure is presented.