Squalene synthase (SQS) catalyzes the first reaction of the branch of the isoprenoid metabolic pathway committed specifically to sterol biosynthesis. Regulation of SQS is thought to direct proximal intermediates in the pathway into either sterol or nonsterol branches in response to changing cellular requirements. The importance of SQS in cholesterol metabolism has stimulated research on the mechanism, structure, and regulation of the enzyme. SQS produces squalene, a C30 isoprenoid, in a two-step reaction in which two molecules of farnesyl diphosphate are condensed head to head. Site-directed mutagenesis of rat SQS has identified conserved Tyr, Phe, and Asp residues that are essential for function. The aromatic rings of Tyr and Phe are postulated to stabilize carbocation intermediates of the first and second half-reactions, respectively; the acidic Asp residues may be required for substrate binding. SQS activity, protein level, and gene transcription are strictly and coordinately regulated by cholesterol status, decreasing with cholesterol surfeit and increasing with cholesterol deficit. The human SQS (hSQS) gene has an unusually complex promoter with multiple binding sites for the sterol regulatory element binding proteins SREBP-1a and SREBP-2, and for accessory transcription factors known to be involved in the control of other sterol-responsive genes. SREBP-1a and SREBP-2 require different subsets of hSQS regulatory DNA elements to achieve maximal promoter activation. Current research is directed at elucidating the precise contribution made by individual SREBPs and accessory transcription factors to hSQS transcriptional control.