The ether phospholipid platelet-activating factor (PAF) has been generally assumed to be released into the extracellular environment by the cells of origin, whereupon it effects its well-known mediator functions. However, during the generation of PAF by human neutrophils, it was noted that the majority of the measurable PAF remained associated with the cells. Accordingly, the intracellular and extracellular distribution of PAF was examined in neutrophils and several other cell types. No PAF was detected in association with unstimulated neutrophils. However, in stimulated neutrophils, PAF was produced and the majority of this material remained in association with the cells independent of the type of stimulus, dose of stimulus, or method of cell isolation used. This pattern of cell association of PAF was seen in all but one of the cell types tested. The retention of PAF by stimulated neutrophils was not due to spurious underestimates of the extracellular levels due to extracellular metabolism and inactivation of released PAF, nor to release followed by readsorption or binding of PAF to the cells. The retention of PAF also occurred in the presence of plasma and appears to be a common phenomenon. Thus, the majority of newly synthesized PAF appears to be retained within the cell and not released.