The presence of covalently bound fatty acids in the insulin receptor has been explored in cultured human (IM-9) lymphocytes. Both alpha (Mr = 135,000) and beta (Mr = 95,000) subunits of the receptor incorporate [3H]myristic and [3H]palmitic acids in a covalent form. The effects of alkali and hydroxylamine on the labeled subunits indicate the existence of two different kinds of fatty acid linkage to the protein with chemical stabilities compatible with amide and ester bonds. The alpha subunit contains only amide-linked fatty acid while the beta subunit has both amide- and ester-linked fatty acids. Analysis by high performance liquid chromatography after acid hydrolysis of the [3H]myristate- and [3H]palmitate-labeled subunits demonstrates the fatty acid nature of the label. Furthermore, both [3H]myristic and [3H]palmitic acids are found attached to the receptor subunits regardless of which fatty acid was used for labeling. The incorporation of fatty acids into the insulin receptor is dependent on protein synthesis and is also detectable in the Mr = 190,000 proreceptor form. Fatty acylation is a newly identified post-translational modification of the insulin receptor which may have an important role in its interaction with the membrane and/or its biological function.