N-acyl taurines (NATs) are bioactive lipids with emerging roles in glucose homeostasis and lipid metabolism. The acyl chains of hepatic and biliary NATs are enriched in polyunsaturated fatty acids (PUFAs). Dietary supplementation with a class of PUFAs, the omega-3 fatty acids, increases their cognate NATs in mice and humans. However, the synthesis pathway of the PUFA-containing NATs remains undiscovered. Here, we report that human livers synthesize NATs and that the acyl-chain preference is similar in murine liver homogenates. In the mouse, we found that hepatic NAT synthase activity localizes to the peroxisome and depends upon an active-site cysteine. Using unbiased metabolomics and proteomics, we identified bile acid-CoA:amino acid N-acyltransferase (BAAT) as the likely hepatic NAT synthase in vitro. Subsequently, we confirmed that BAAT knockout livers lack up to 90% of NAT synthase activity and that biliary PUFA-containing NATs are significantly reduced compared with wildtype. In conclusion, we identified the in vivo PUFA-NAT synthase in the murine liver and expanded the known substrates of the bile acidconjugating enzyme, BAAT, beyond classic bile acids to the synthesis of a novel class of bioactive lipids.