Manganese (Mn) and bilirubin (BR) induce intrahepatic cholestasis when injected sequentially. It was suggested that accumulation of newly synthesized cholesterol in the canalicular membrane is an initial step in the development of cholestasis. To clarify the involvement of cholesterol in the pathogenesis of Mn-BR-induced cholestasis, we examined biliary secretion and liver subcellular distribution of lipids in the cholestatic conditions (Mn-BR combination). We also examined hepatic metabolism of cholesterol under cholestatic and noncholestatic (Mn or BR given alone) conditions. The Mn-BR combination reduced bile flow by 50%, and bile acid, phospholipids, and cholesterol output by 42, 75, and 90%, respectively. There was a dramatic impairment of cholate excretion but not chenodeoxycholate excretion. Phosphatidylcholine species secreted into bile were unchanged, and microsomal total phospholipid content was significantly increased. Although there was no changes in liver membrane phospholipid content, the cholesterol/phospholipid ratio was increased by more than 50% in the canalicular fraction. Despite the increased concentration of cholesterol in canalicular membrane the activities of 3-hydroxy-3-methylglutaryl coenzyme A (HMG-CoA) reductase, key enzyme in cholesterol synthesis, and cholesterol 7alpha-hydroxylase, key enzyme in cholesterol conversion to bile acids, were significantly reduced. However, the injection of Mn alone significantly increased both enzymes, while BR alone inhibited cholesterol 7alpha-hydroxylase by 62%, without affecting HMG-CoA reductase. In conclusion, the critical cholestatic events in Mn-Br-induced cholestasis appear to be mediated through the synergistic effects of Mn and BR acting on synthesis and degradation of cholesterol.