The process of absorption of fats takes place in the small intestine.
Fatty acids are insoluble; hence they are first broken into small droplets called micelle, by the process of emulsification.
Emulsification is the process of breaking down of the large fat globules into smaller globules and make them water soluble.
The liver secretes bile juice in the small intestine which causes emulsification of fats.
They are further reform into small protein-coated fat globule called chylomicron (in intestinal mucosa), which are then transported into lacteals in villi, which finally release them into blood stream.