The activity of the brown fat uncoupling protein (UCP1) is regulated by purine nucleotides and fatty acids. Although the inhibition by nucleotides is well established, the activation by fatty acids is still controversial. It has been reported that the ADP/ATP carrier, and possibly other members of the mitochondrial carrier family, mediate fatty acid uncoupling of mitochondria from a variety of sources by facilitating the transbilayer movement of the fatty acid anion. Brown fat mitochondria are known to be more sensitive to fatty acid uncoupling, a property that has been assigned to the presence of UCP1. We have analyzed the transport properties of UCP1 and conclude that fatty acids are not essential for UCP1 function, although they increase its uncoupling activity. In order to establish the difference between the proposed carrier-mediated uncoupling and that exerted through UCP1, we have studied the facility with which fatty acids uncouple respiration in mitochondria from control yeast and strains expressing UCP1 or the mutant Cys-304 --> Gly. The concentration of free palmitate required for half-maximal activation of respiration in UCP1-expressing mitochondria is 80 or 40 nM for the mutant protein. These concentrations have virtually no effect on the respiration of mitochondria from control yeast and are nearly 3 orders of magnitude lower than those reported for carrier-mediated uncoupling. We propose that there exist two modes of fatty acid-mediated uncoupling; nanomolar concentrations activate proton transport through UCP1, but only if their concentrations rise to the micromolar range do they become substrates for nonspecific carrier-mediated uncoupling.