Highly purified human granulocytes synthesize [14C]farnesol and [14C]squalene but not [14C]sterols from [14C]mevalonic acid. Dimethylsulfoxide was found to be an excellent vehicle for carrying [3H]squalene-2, 3-oxide into the intact cells. The granulocytes synthesized [3H]lanosterol from this substrate, but were unable to further process the newly synthesized lanosterol along the cholesterol biosynthetic pathway. In contrast, intact lymphocytes and monocytes were able to synthesize radioactive cholesterol from either [14C]mevalonic acid or [3H]squalene-2,3-oxide. These results indicate that normal human granulocytes have retained squalene-2,3-oxide-lanosterol cyclase activity but have lost squalene epoxidase activity and at least one other mixed function oxidase activity that is required to transform lanosterol into cholesterol. These results may provide an explanation for the accumulation of farnesol and squalene that has been previously observed in populations of mixed leukocytes (Fogelman, A. M., Edmond, J., Seager, J., and Popják, G. (1975) J. Biol. Chem. 250: 2045-2055 (1); Burns, C. P., Welshman, I. R., Edmond, J., and Spector A. A. (1979) Biochim. Biophys. Acta 572: 345-351) (12).