Before the menopause, women are relatively protected against CVD compared with men. The reasons for this sex difference are not completely understood, but hepatic fatty acid metabolism may play a role. The present study aimed to investigate the utilisation of plasma NEFA by the liver and to determine whether they are partitioned differently into ketone bodies and VLDL-TAG in healthy, lean young men and women. Volunteers were studied during a prolonged overnight fast (12–19 h) using an intravenous infusion of [U-13C]palmitate. After 12 h fasting, the women had a more advantageous metabolic profile with lower plasma glucose (P < 0·05) and TAG (P < 0·05) but higher plasma NEFA (P < 0·05) concentrations. Plasma 3-hydroxybutyrate (3-OHB) concentrations rose more in women than in men, and the transfer of 13C from [U-13C]palmitate to plasma [13C]3-OHB reached a plateau 6–7 h after the start of the infusion in women but was still increasing at 6 h in men. This implies a slower 3-OHB production rate and/or dilution by other precursor pools in men. In women, the high isotopic enrichment of plasma 3-OHB suggested that systemic plasma fatty acids were the major source of 3-OHB production. However, in men, this was not observed during the course of the study (P < 0·01). There were no sex differences for the incorporation of 13C into VLDL1- or VLDL2-TAG. The ability of young women to partition fatty acids towards ketone body production rather than VLDL-TAG may contribute to their more advantageous metabolic profile compared with young men.