Fatty acid chain elongation is a crucial step in the biosynthesis of long chain fatty acids. An essential reaction in the elongation process is condensation of malonyl-CoA with acyl-CoA, which is catalyzed by beta-ketoacyl-CoA synthase (KCS) in plants. We have isolated and characterized the MpFAE3 gene, one of the KCS gene family in the liverwort Marchantia polymorpha. Transgenic M. polymorpha plants overexpressing MpFAE3 accumulate fatty acids 18:0, 20:0, and 22:0. In these plants, the amount of 16:0 is reduced to 50% of wild type. In a heterologous assay, transgenic methylotrophic yeast expressing the MpFAE3 gene accumulates fatty acid 18:0 and generates several longer fatty acids which are not detectable in the control, accompanied by a decrease of 16:0. These observations indicate that the MpFAE3 protein is preferentially involved in the elongation of 16:0 to 18:0 and also in the subsequent steps of 18:0 to 20:0 and 20:0 to 22:0 in M. polymorpha.