Cholesterol homeostasis in mammals involves pathways for biosynthesis, cellular uptake, and hepatic conversion to bile acids. Key genes for all three pathways are regulated by negative feedback control. Uptake and biosynthesis are directly regulated by cholesterol through its inhibition of the proteolytic activation of the sterol regulatory element binding proteins. The conversion of cholesterol into bile acids in the liver is regulated through the bile acid-dependent induction of the negatively acting small heterodimer partner nuclear receptor. In this report, we have shown that the small heterodimer partner also directly regulates cholesterol biosynthesis through inhibition of 3-hydroxy-3-methylglutaryl coenzyme A reductase but has no effect on low density lipoprotein receptor expression. This has significant metabolic significance, as it provides both a mechanism to independently regulate cholesterol synthesis from uptake (an essential regulatory feature known to occur in vivo) and a pathway for direct regulation of cholesterol biosynthesis by bile acids. This latter feature ensures that the early phase of bile acid synthesis (pre-cholesterol) is in metabolic communication with the later stages of the pathway to properly regulate whole pathway flux. This highlights an important regulatory feature that is shared with other key branched, multienzyme pathways, such as glycolysis, where pathway outflow through pyruvate kinase is regulated by the concentration of a key early intermediate, fructose 1,6-bisphosphate.