Palmitoylation is the covalent attachment of fatty acids, such as palmitic acid, to cysteine (S-palmitoylation) and less frequently to serine and threonine (O-palmitoylation) residues of proteins, which are typically membrane proteins. The precise function of palmitoylation depends on the particular protein being considered. Palmitoylation enhances the hydrophobicity of proteins and contributes to their membrane association. Palmitoylation also appears to play a significant role in subcellular trafficking of proteins between membrane compartments, as well as in modulating protein¨Cprotein interactions. In contrast to prenylation and myristoylation, palmitoylation is usually reversible (because the bond between palmitic acid and protein is often a thioester bond). The reverse reaction in mammalian cells is catalyzed by acyl-protein thioesterases (APTs) in the cytosol and palmitoyl protein thioesterases in lysosomes. Because palmitoylation is a dynamic, post-translational process, it is believed to be employed by the cell to alter the subcellular localization, protein¨Cprotein interactions, or binding capacities of a protein.

Reference
Wiki: Palmitoylation