Mice lacking the nuclear bile acid receptor FXR/BAR developed normally and were outwardly identical to wild-type littermates. FXR/BAR null mice were distinguished from wild-type mice by elevated serum bile acid, cholesterol, and triglycerides, increased hepatic cholesterol and triglycerides, and a proatherogenic serum lipoprotein profile. FXR/BAR null mice also had reduced bile acid pools and reduced fecal bile acid excretion due to decreased expression of the major hepatic canalicular bile acid transport protein. Bile acid repression and induction of cholesterol 7alpha-hydroxylase and the ileal bile acid binding protein, respectively, did not occur in FXR/BAR null mice, establishing the regulatory role of FXR/BAR for the expression of these genes in vivo. These data demonstrate that FXR/BAR is critical for bile acid and lipid homeostasis by virtue of its role as an intracellular bile acid sensor.