The fungal metabolite Brefeldin A was found to inhibit the production of the infectious enveloped form of vaccinia virus, although production of the infectious intracellular form was not affected. Electron microscopic analysis and caesium chloride density centrifugation of progeny virions indicates that the drug block is not due to retention and accumulation of enveloped virions within the cell. Biochemical analysis of the candidate envelopment receptor for vaccinia virus, viral protein P37, shows that the drug has no discernible effect on palmitylation of this protein and does not prevent or alter its association with intracellular membranes. This suggests that P37 may not in fact be the receptor on intracellular membranes for vaccinia virus envelopment, and leaves open the question of what function this molecule performs in the envelopment process. 24AI 20563