Mice without oxysterol 7alpha-hydroxylase, an enzyme of the alternate bile acid synthesis pathway with a sexually dimorphic expression pattern, were constructed by the introduction of a null mutation at the Cyp7b1 locus. Animals heterozygous (Cyp7b1(+/-)) and homozygous (Cyp7b1(-/-)) for this mutation were grossly indistinguishable from wild-type mice. Plasma and tissue levels of 25- and 27-hydroxycholesterol, two oxysterol substrates of this enzyme with potent regulatory actions in cultured cells, were markedly elevated in Cyp7b1(-/-) knockout animals. Parameters of bile acid metabolism as well as plasma cholesterol and triglyceride levels in male and female Cyp7b1(-/-) mice were normal. The cholesterol contents of major tissues were not altered. In vivo sterol biosynthetic rates were unaffected in multiple tissues with the exception of the male kidney, which showed a approximately 40% decrease in de novo synthesis versus controls. We conclude that the major physiological role of the CYP7B1 oxysterol 7alpha-hydroxylase is to metabolize 25- and 27-hydroxycholesterol and that loss of this enzyme in the liver is compensated for by increases in the synthesis of bile acids by other pathways. A failure to catabolize oxysterols in the male kidney may lead to a decrease in de novo sterol synthesis.