Catalyzes the thiolytic cleavage of 3-ketoacyl-CoA with 8-16 carbon residues in the acyl group using a ping-pong mechanism whereby binding to 3-ketooctanoyl-CoA results in the release of acetyl-CoA and the subsequent addition of CoA produces 3-ketohexanohyl-CoA (PubMed:9151950). Involved in the biosynthesis of the dauer pheromone by providing short chains of fatty acid that are attached to the ascarylose sugars of the pheromone (PubMed:19496754, PubMed:19174521). choloyl-CoA + propanoyl-CoA = 3alpha,7alpha,12alpha-trihydroxy-24-oxo-5beta-cholestan-26-oyl-CoA + CoA Inhibited by acetyl-CoA. Punctate localization in the cytoplasm. Expressed in intestine, hypodermis and body-wall muscle. Expressed in all larval stages with levels peaking at the L3 larval stage and decreasing in the adult. In short-term culture, loss of the capacity to enter the dauer stage which is associated with a loss in the production of the dauer pheromone. In long-term culture, the capacity to induce the dauer stage is restored and is associated with the accumulation of long fatty acid chain ascarosides (PubMed:19174521). Intestinal expression of daf-22 restores the production of the pheromone (PubMed:19174521). Partial dauer phenotype in only half of mutants when the dauer pheromone is added exogenously (PubMed:19496754). In addition, mutants accumulate large fat granules in the intestine, have a decreased growth rate resulting in smaller adults and have a substantial reduction in brood size (PubMed:19496754). Belongs to the thiolase-like superfamily. Thiolase family.