Phosphatidylethanolamine is converted to phosphatidylcholine in hepatocytes via the enzyme phosphatidylethanolamine N-methyltransferase (PEMT). An isoform, PEMT2 has been cloned, expressed and localized to a mitochondria-associated membrane in rat liver. Expression of PEMT2 caused a decreased rate of cell division of cultured rat hepatoma cells. Mechanistic studies suggest that the slower growth of transfected hepatoma cells may be due to down regulation of CTP: phosphocholine cytidylyltransferase and the CDP-choline pathway for phosphatidylcholine biosynthesis. A role for PEMT2 in the regulation of hepatocyte cell division is also indicated by PEMT2 down-regulation in regenerating rat liver.