Functional implications of the recently described fatty acid conjugation of budesonide (BUD) (Tunek, A., K. Sjödin, and G. Hallström, Drug Metabol. Dispos. 1997;25:1311-1317; Miller-Larson, A., E. Hjertberg, H. Mattsson, M. Dahlbäck, A. Tunek, and R. Brattsand, Am. J. Respir. Crit. Care Med. 1997;155:A353 [Abstr.]) were studied in a rat cell line, Rat1, transfected with the activation protein-1 (AP-1)-controlled regulatory element (TRE) driving the reporter gene beta-galactosidase. TRE is downregulated by glucocorticosteroids (GCS) through interaction with the AP-1 complex. BUD was compared to fluticasone propionate (FP), a potent glucocorticosteroid that does not form fatty acid conjugates. The kinetics and metabolism of the GCS were studied after incubation of either 3H-BUD or 3H-FP with transfected Rat1 cells. Up to 20% of added BUD was taken up into the cells over 24 h. The great majority of the intracellular radioactivity (80-90%) consisted of lipophilic BUD conjugates. After removing extracellular 3H-GCS, the outflow of radioactivity was studied. Only free BUD and not fatty acid conjugates was detected extracellularly, suggesting that hydrolysis of the conjugates was required to release BUD from the cell. During 165 min, less BUD (about 65% of totally incorporated) was released than FP (more than 90%). In the functional studies, FP was about six times more potent than BUD in downregulating TRE after 24 h continuous exposure. However, after a 6-h pulse of GCS, the effect of BUD persisted unchanged 18 h later, whereas FP had almost lost its efficacy (P < 0.05 between the drugs). In addition, the reversible conjugation process of BUD resulted in transferable GCS effects. Medium containing released BUD from previously loaded cells mediated nearly the same downregulatory effect after addition to naive cells as did continuous treatment. No such transferable effect was seen for FP. In conclusion, the reversible fatty acid conjugation of BUD resulted in prolonged cellular retention and anti-inflammatory activity after pulse exposure in this in vitro system. This fatty acid conjugation mechanism appears to add to the beneficial pharmacologic profile of BUD.