Extrahepatic biliary atresia (BA) is a devastating disease of the neonate in which the hepatic and/or common bile duct is obliterated or interrupted. Infants and children with this diagnosis constitute 50% to 60% of the pediatric population that undergoes orthotopic liver transplantation. However, there is still very little known about the etiology and pathogenesis of BA. Several recent studies have demonstrated that anomalies of situs determination are more commonly associated with BA than previously recognized. In this study, we examined the pathogenesis of jaundice in the inv mouse, a transgenic mouse in which a recessive deletion of the inversin gene results in situs inversus and jaundice. The results show that these mice have cholestasis with conjugated hyperbilirubinemia, failure to excrete technetium-labeled mebrofenin from the liver into the small intestine, lack of continuity between the extrahepatic biliary tree and the small intestine as demonstrated by Trypan blue cholangiography, and a liver histological picture indicative of extrahepatic biliary obstruction with negligible inflammation/necrosis within the hepatic parenchyma. Lectin histochemical staining of biliary epithelial cells in serial sections suggests the presence of several different anomalies in the architecture of the extrahepatic biliary system. These results suggest that the inversin gene plays an essential role in the morphogenesis of the hepatobiliary system and raise the possibility that alterations in the human orthologue of inversin account for some of the cases of BA in which there are also anomalies of situs determination.