Modulating endogenous levels and/or producing novel fatty acids of oils have gained significant attention in recent years to meet the demand for oils for specific markets. The commodity palm oil is composed mainly of four fatty acids: palmitic acid (16:0), stearic acid (18:0), oleic acid (18:1) and linoleic acid (18:2). The percentages of these fatty acids in palm oil average 44%, 4%, 39% and 10%, respectively, with trace amounts of other fatty acids. Metabolic engineering may be used to produce oil crops with desired fatty acid compositions. We have isolated and characterised β-ketoacyl ACP-synthase II (KASII) cDNA from oil palm (Elaeis guineensis) which is one of the main components for the oil palm genetic engineering programme. KAS II is associated with the accumulation of palmitic acid in oil palm, and its role in controlling the ratio of C16:C18 has been previously determined. We isolated KAS II cDNA from oil palm, and functionally characterised the same in Escherichia coli and Arabidopsis. Partial length KAS II cDNA was first obtained by the reverse transcriptase-polymerase chain reaction (RT-PCR). Rapid amplification of cDNA ends (RACE) was then used to isolate both the 5’ and 3’ ends of the KAS II sequences. Assembly of the partial length sequence fragments, including the 5’ and 3’ ends, allowed for the full-length sequence information on the KAS II cDNA to be obtained and used in the gene isolation. Expression studies in E. coli resulted in an increase in oleic acid at the expense of palmitic acid. Arabidopsis thaliana was also used to further confirm the functional activity of the oil palm KAS II. A significant decrease in C18:0 and accumulation of C16:0 were detected in the plants that had been transformed with the antisense KASII construct. This suggests that the substrate specificity of the oil palm KAS II is similar to that of KAS II from other plants which preferentially elongate palmitic to stearic acids. The oil palm KAS II may, therefore, be useful in providing new opportunities in the genetic engineering programme for the production of high-value products such as an oil with a high content of monounsaturated fatty acids from the transgenic oil crops.