Acyl CoA:monoacylglycerol acyltransferase (MGAT) catalyzes the synthesis of diacylglycerol, a precursor of triacylglycerol. In the intestine, MGAT plays a major role in the absorption of dietary fat by catalyzing the resynthesis of triacylglycerol in enterocytes. This resynthesis is required for the assembly of lipoproteins that transport absorbed fat to other tissues. Despite intense efforts, a gene encoding an intestinal MGAT has not been found. Previously, we identified a gene encoding MGAT1, which in mice is expressed in the stomach, kidney, adipose tissue, and liver but not in the intestine. We now report the identification of homologous genes in humans and mice encoding MGAT2. Expression of the MGAT2 cDNA in either insect or mammalian cells markedly increased MGAT activity in cell membranes. MGAT activity was proportional to the level of MGAT2 protein expressed, and the amount of diacylglycerol produced depended on the concentration of MGAT substrates (fatty acyl CoA or monoacylglycerol). In humans, the MGAT2 gene is highly expressed in the small intestine, liver, stomach, kidney, colon, and white adipose tissue; in mice, it is expressed predominantly in the small intestine. The discovery of the MGAT2 gene will facilitate studies to determine the functional role of MGAT2 in fat absorption in the intestine and to determine whether blocking MGAT activity in enterocytes is a feasible approach to inhibit fat absorption and treat obesity.