1. Mycophenolic acid, an antibiotic of some antiquity that more recently has been found to have marked activity against a range of tumours in mice and rats, strongly inhibits DNA synthesis in the L strain of fibroblasts in vitro. 2. The extent of the inhibition of DNA synthesis is markedly increased by preincubation of the cells with mycophenolic acid before the addition of [14C]thymidine. 3. The inhibition of DNA synthesis by mycophenolic acid in L cells in vitro is reversed by guanine in a non-competitive manner, but not by hypoxanthine, xanthine or adenine. 4. The reversal of inhibition by guanine can be suppressed by hypoxanthine, 6-mercaptopurine and adenine. 5. Mycophenolic acid does not inhibit the incorporation of [14C]thymidine into DNA in suspensions of Landschütz and Yoshida ascites cells in vitro. 6. Mycophenolic acid inhibits the conversion of [14C]hypoxanthine into cold-acid-soluble and -insoluble guanine nucleotides in Landschütz and Yoshida ascites cells and also in L cells in vitro. There is some increase in the radioactivity of the adenine fraction in the presence of the antibiotic. 7. Mycophenolic acid inhibits the conversion of [14C]hypoxanthine into xanthine and guanine fractions in a cell-free system from Landschütz cells capable of converting hypoxanthine into IMP, XMP and GMP. 8. Preparations of IMP dehydrogenase from Landschütz ascites cells, calf thymus and LS cells are strongly inhibited by mycophenolic acid. The inhibition showed mixed type kinetics with Ki values of between 3·03×10−8 and 4·5×10−8m. 9. Evidence was also obtained for a partial, possibly indirect, inhibition by mycophenolic acid of an early stage of biosynthesis of purine nucleotides as indicated by a decrease in the accumulation of formylglycine amide ribonucleotide induced by the antibiotic azaserine in suspensions of Landschütz and Yoshida ascites cells and L cells in vitro.