Pn this contribution the kinetic mechanism and substrate specificity of Escherichia coli diacylglycerol kinase were examined. Steady state kinetic studies were carried out under mixed micellar conditions using a novel continuous coupled assay system. The kinetic data were consistent with a random equilibrium mechanism, implying that diacylglycerol kinase catalyzes direct phosphoryl transfer from MgATP to diacylglycerol, This was supported by failure to detect an enzyme-phosphate covalent intermediate and by the observation that the bisubstrate analog adenosine 5'-tetraphosphoryl-3-O-(1,2-dihexanoyl)-sn-glycerol inhibits the enzyme (K-i much less than K-m,K-DAG). While diacylglycerol kinase's k(cat)/K-m is modest compared with the efficiency of many water-soluble enzymes, the enzyme nevertheless appears to be all evolutionarily optimized biocatalyst in the sense that its chemical reaction rate approaches the substrate diffusion-controlled limit, The fit vitro rate-limiting step of DAGK's reaction appears to be, in part, the transbilayer diffusion of diacylglycerol from the outer leaflet to the inner leaflet of the cytoplasmic membrane where DAGK's active site is located, DAGK was observed to maintain a high nucleotide substrate specificity, with most of this specificity being expressed in the form of reductions in K-cat for ATP analogs.