It is well known that the oral bioavailability of peptide and protein drugs is generally poor because they are extensively degraded by proteases in the gastrointestinal tract and impermeable through the intestinal mucosa. Therefore, various approaches have been examined to overcome the delivery problems of these peptides and to improve their absorption via the gastrointestinal tract. Of these approaches, a potentially useful approach to solve these delivery problems may be chemical modification of peptides and proteins to produce prodrugs and analogues. Thus, it is plausible that this chemical approaches may protect peptides against degradation by peptidases and other enzymes present at the mucosal barrier and renders the peptides and proteins more lipophilic, resulting in increased bioavailability. From these standpoints, we synthesized lipophilic derivatives of peptides and proteins such as thyrotropin-releasing hormone (TRH), tetragastrin (TG), calcitonin and insulin by chemical modification with fatty acids. The pharmacological activities of these derivatives were relatively high as compared with the native peptides. A significant increase in the intestinal absorption of these derivatives of peptides was observed in comparison with native peptides. Overall, the effects of acylation on the intestinal absorption of these peptides were more predominant in the large intestine than those in the small intestine. In addition, these derivatives were more stable than the parent peptides in homogenates of the various intestinal mucosae. We also examined the intestinal transport characteristics of TG and its acyl derivatives using Caco-2 cell monolayer system in order to assess the contribution of enzymatic and transport barriers on their intestinal absorption. The degradation clearance of TG on the apical membrane was decreased by chemical modification with fatty acids. In addition, the permeability clearance of TG was improved by the acylation. On the other hand, CLp value of carboxyfluorescein, a paracellular transport marker, was increased by the coadministration with acyl-TGs, suggesting that these derivatives have absorption enhancing actions and may enhance themselves across the Caco-2 cell monolayers. In summary, this chemical modification approaches may be useful to improve the intestinal absorption of peptides and proteins.