1. A number of tissues, in particular, brain, liver, and kidney, incubated aerobically in vitro as slices or ground suspensions produce a compound which combines with p-aminobenzoic acid in acid solution to form a yellow color. 2. A study of this reaction in rat brain has shown that this compound can be produced when washed boiled brain protein is incubated aerobically with ascorbic acid. The latter acts as a catalyst to break the linkage between the protein and the compound. Oxygen is taken up in the process. 3. A number of aromatic hydroxy compounds such as epinephrine and catechol inhibit the reaction. Cyanide has little or no effect. No reaction occurs anaerobically. 4. The occurrence of the reaction in some animals has been described.