Uncoupling protein-3 (UCP3) is a mitochondrial inner membrane protein expressed most abundantly in skeletal muscle and to a lesser extent in heart and brown adipose tissue. Evidence supports a role for UCP3 in fatty acid oxidation (FAO); however, the underlying mechanism has not been explored. In 2001 we proposed a role for UCP3 in fatty acid export, leading to higher FAO rates (Himms-Hagen, J., and Harper, M. E. (2001) Exp. Biol. Med. (Maywood) 226, 78-84). Specifically, this widely held hypothesis states that during elevated FAO rates, UCP3 exports fatty acid anions, thereby maintaining mitochondrial co-enzyme A availability; reactivation of exported fatty acid anions would ultimately enable increased FAO. Here we tested mechanistic aspects of this hypothesis as well as its functional implications, namely increased FAO rates. Using complementary mechanistic approaches in mitochondria from wild-type and Ucp3(-/-) mice, we find that UCP3 is not required for FAO regardless of substrate type or supply rate covering a 20-fold range. Fatty acid anion export and reoxidation during elevated FAO, although present in skeletal muscle mitochondria, are independent of UCP3 abundance. Interestingly, UCP3 was found to be necessary for the fasting-induced enhancement of FAO rate and capacity, possibly via mitigated mitochondrial oxidative stress. Thus, although our observations indicate that UCP3 can impact FAO rates, the mechanistic basis is not via an integral function for UCP3 in the FAO machinery. Overall our data indicate a function for UCP3 in mitochondrial adaptation to perturbed cellular energy balance and integrate previous observations that have linked UCP3 to reduced oxidative stress and FAO.