Carnitine acyltransferases have crucial functions in fatty acid metabolism. Members of this enzyme family show distinctive substrate preferences for short-, medium- or long-chain fatty acids. The molecular mechanism for this substrate selectivity is not clear as so far only the structure of carnitine acetyltransferase has been determined. To further our understanding of these important enzymes, we report here the crystal structures at up to 2.0-A resolution of mouse carnitine octanoyltransferase alone and in complex with the substrate octanoylcarnitine. The structures reveal significant differences in the acyl group binding pocket between carnitine octanoyltransferase and carnitine acetyltransferase. Amino acid substitutions and structural changes produce a larger hydrophobic pocket that binds the octanoyl group in an extended conformation. Mutation of a single residue (Gly-553) in this pocket can change the substrate preference between short- and medium-chain acyl groups. The side chains of Cys-323 and Met-335 at the bottom of this pocket assume dual conformations in the substrate complex, and mutagenesis studies suggest that the Met-335 residue is important for catalysis.