It has increasingly been suggested that the short-chain fatty acids (SCFA) acetic, propionic and butyric acids, derived from colonic fermentation of dietary fibre and other indigestible carbohydrates, exert different physiological effects. Formation of propionic acid is discussed in terms of beneficial effects on glucose and cholesterol metabolism. The aim of the present study was to evaluate possible metabolic effects of propionic acid and to differentiate between effects mediated in the upper gastrointestinal tract and those mediated in the hind-gut. For this purpose, obese hyperinsulinaemic (fa/fa) rats were studied during a 19 d test period. Sodium propionate was either fed orally through the diet (1 g/d), or infused rectally (0·15 g/d) to animals given diets high in cholesterol (20 g/kg) and saturated fat (130g/kg). At the end of the test period total liver cholesterol pools were 20% lower (P < 0·01) in rats given dietary or rectally infused propionate (481 and 484 mg respectively) compared with the control group (614 mg). This was due to lower liver weights (P < 0·05) in propionate-treated animals, 15·5 and 15·3 g, v. 18·2 g in the control group, and no differences were noted in hepatic cholesterol concentrations. The urinary glucose excretion was measured during days 15–19 and was found to be lower (P < 0·05) in rats fed with propionate (23 mg) compared with the control group or the group infused rectally (39 and 38 mg respectively). In addition, fasting plasma glucose concentrations decreased significantly (P < 0·05) over the test period. It is concluded that orally supplied propionate affects both glucose and cholesterol metabolism as judged from lowered urinary glucose excretion, fasting blood glucose and liver cholesterol pools. On the other hand, propionate administered to the hind-gut at a physiologically relevant level reduces the hepatic cholesterol pool.