In an effort to define the mechanism by which thyroid hormone increases the synthesis of hepatic cholesterol, we have investigated both in hypophysectomized and methimazole-treated hypothyroid rats the time course of T₃ effects on plasma cholesterol concentration, total hepatic cholesterol, the rate of biliary secretion of cholesterol, bile acids, and phospholipids, and the activity and mRNA levels of 3-hydroxy-3-methylglutaryl coenzyme-A (HMG-CoA) reductase, the rate-limiting enzyme in the hepatic synthesis of cholesterol. A single dose of 200 μg T₃ was estimated to maintain at least 90% nuclear occupancy for the ensuing 54 h of the experiment. In both preparations the relative rise in biliary secretion of cholesterol exceeded that of other biliary constituents and preceded by 12 h an increase in HMG-CoA reductase enzyme activity and its mRNA. The level of total hepatic cholesterol remained constant throughout the experiment. We interpret these findings to suggest that T₃-stimulated cholesterol synthesis is mediated by an antecedent T₃-induced rise in biliary cholesterol secretion. We postulate that biliary cholesterol secretion is augmented by an intrahepatic shift of cholesterol and depletion of the hepatic sampling center responsible for the feedback regulation of cholesterol synthesis. The level of HMG CoA reductase mRNA appeared to govern enzyme activity in both preparations, but the ratio of mRNA to hepatic enzyme activity was substantially greater in the methimazole-treated compared with the hyphophysectomized animals.