Water-reducible acrylic-alkyd resins were synthesized from the reaction between monoglycerides prepared from modified palm oil and carboxy-functional acrylic copolymer followed by neutralization of carboxyl groups with diethanolamine. Modified palm oil was produced by interesterification of palm oil with lung oil at a weight ratio of 1 : 1, using sodium hydroxide as a catalyst, whereas carboxy-functional acrylic copolymer was prepared by radical copolymerization of n-butyl methacrylate and maleic anhydride. The amount of acrylic copolymer used was from 15 to 40% by weight, and it was found that homogeneous resins was obtained when the copolymer content was 20-35 wt %. All of the prepared water-reducible acrylic-alkyd resins were yellowish viscous liquids. Their films were dried by baking at 190 degrees C and their properties were determined. These films showed excellent water and acid resistance and good alkali resistance. (c) 2005 Wiley Periodicals, Inc.