Diacetyl production by propionibacteria in milk cultures was studied using a previously described sensitive method specific for diacetyl. Twenty-four strains belonging to six Propionibacterium species were included in the study. A strain of P. shermanii that produced relatively large amounts of diacetyl in milk was chosen for investigations on factors affecting diacetyl production.Accumulation of the diketone in milk cultures was greater at 21 C than at 32 or 37 C although the rate of production of the compound was greater at the higher temperatures. Rapid cooling after incubation stabilized the diacetyl levels in milk cultures, and prolonged refrigerated holding caused an increase in the concentration of the flavor compound. The dicarbonyl production was greatly affected by the pH of the culture medium, the most favorable range being 4.0 to 4.5. In mixed culture study using a homo-fermentative Streptococcus lactis in combination with the P. shermanii strain, diacetyl production by the latter was greatly enhanced by the rapid pH depression brought about by the streptococci. Diacetyl reductase assays on cell-free extract preparations from the P. shermanii strain showed little or no activity.