The anemia of thermal injury is characterized by a decreased RBC half-life and abnormal RBC morphology (predominantly echinocytes). These changes are reversible in crossover studies with normal recipients, suggesting an extrinsic mechanism unrelated to initial heat or mechanical damage. Since alterations in plasma lipids, which are freely exchangeable with red cell lipids, produce similar changes, plasma and erythrocyte membrane lipid composition in 30 patients (mean 60% TBSA) was determined and related to RBC morphology in vivo and in vitro. Total cholesterol (TC) and phospholipids (PL) were decreased in plasma and plasma lipoproteins (LP) but remained normal in red blood cell membranes. The deficit in TC and LP cholesterol resulted from decreased cholesterol esters. Plasma phospholipids contained increased phosphatidylcholine (PC) and low lysophosphatidylcholine (LPC) and sphingomyelin levels. The essential fatty acid (EFA) composition of total plasma lipids rapidly decreased, with a more gradual decrease in EFA in red cell lipids. The ratio of free fatty acids to albumin in the plasma was greatly increased throughout and may have a primary role in the abnormal erythhrocyte morphology and decreased half-life in burned patients.