Acyl-CoA:monoacylglycerol acyltransferase-2 (MGAT2) catalyzes the synthesis of diacylglycerol and differs from the MGAT1 and MGAT3 in tissue distribution at the mRNA level. In addition to the small intestine, MGAT2 mRNA is also expressed at high levels in human liver, the lower gastrointestinal tract, and the mouse kidney, but the physiological significance of such expression has not yet been studied. Using an affinity-purified antibody, the present study investigated the expression of murine MGAT2 protein along the intestinal tract, determined its subcellular localization, and studied its regulation by diet and in db/db mouse. Results demonstrate a high level of MGAT2 expression in the small intestine in a proximal-to-distal gradient that correlated well with both MGAT enzyme activity and fat absorption pattern. In contrast, MGAT2 protein was not detectable in other sections of the digestive tract, including stomach, cecum, colon, and rectum, or other mouse tissues such as kidney, liver, and adipocytes. Immunohistological studies provided direct evidence that the enzyme is expressed not only in the villi, but also in the crypt regions of the small intestine, which suggests that MGAT2 expression occurs prior to the maturation of enterocytes. MGAT2 is localized in the endoplasmic reticulum (ER) in both MGAT2-transfected COS-7 and Caco-2 cells, indicating that the ER is the primary site for dietary fat re-synthesis. MGAT2 expression appeared not to be affected by diabetes in the db/db mouse, however, the total intestinal MGAT activity was significantly enhanced. Finally, an up-regulation of both MGAT2 protein expression and MGAT activity was observed in mice fed a high fat diet, implicating a role of MGAT2 in diet-induced obesity. Taken together, our data suggest a predominant role of MGAT2 in dietary fat absorption.