The stratum corneum contains a complex mixture of polar and nonpolar lipids in its intercellular spaces. These lipids, present in form of multiple lamellae, have been investigated for their role in providing the epidermal barrier to transcutaneous water loss, the selective barrier from the inside to the outside of the organism and partly the process of physiological desquamation. The composition of these lipids varies from species to species, with the body region and the degree of keratinocyte differentiation. The most undifferentiated layers of the epidermis contain typical membrane lipids, phospholipids, while more differentiated layers contain ceramides, cholesterol and free fatty acids. Essential fatty acids are essential for the maintenance of the lamellar structures and epidermal barrier function. Epidermal linoleic and arachidonic acids derive from exogenous sources. Only recently attempts have been made to elucidate the timing and regulation of epidermal fatty acid metabolism. Keratinocytes do not express a low molecular weight fatty acid binding protein like other cells active in lipid metabolism, but may employ alternative ways in fatty acid uptake and metabolism.