Niemann-Pick type C1 (Npc1) protein inactivation results in lipid accumulation in late endosomes and lysosomes, leading to a defect of ATP binding cassette protein A1 (Abca1)-mediated lipid efflux to apolipoprotein A-I (apoA-I) in macrophages and fibroblasts. However, the role of Npc1 in Abca1-mediated lipid efflux to apoA-I in hepatocytes, the major cells contributing to HDL formation, is still unknown. Here we show that, whereas lipid efflux to apoA-I in Npc1-null macrophages is impaired, the lipidation of endogenously synthesized apoA-I by low density lipoprotein-derived cholesterol or de novo synthesized cholesterol or phospholipids in Npc1-null hepatocytes is significantly increased by about 1-, 3-, and 8-fold, respectively. The increased cholesterol efflux reflects a major increase of Abca1 protein in Npc1-null hepatocytes, which contrasts with the decrease observed in Npc1-null macrophages. The increased Abca1 expression is largely post-transcriptional, because Abca1 mRNA is only slightly increased and Lxr alpha mRNA is not changed, and Lxr alpha target genes are reduced. This differs from the regulation of Abcg1 expression, which is up-regulated at both mRNA and protein levels in Npc1-null cells. Abca1 protein translation rate is higher in Npc1-null hepatocytes, compared with wild type hepatocytes as measured by [(35)S]methionine incorporation, whereas there is no difference for the degradation of newly synthesized Abca1 in these two types of hepatocytes. Cathepsin D, which we recently identified as a positive modulator of Abca1, is markedly increased at both mRNA and protein levels by Npc1 inactivation in hepatocytes but not in macrophages. Consistent with this, inhibition of cathepsin D with pepstatin A reduced the Abca1 protein level in both Npc1-inactivated and WT hepatocytes. Therefore, Abca1 expression is specifically regulated in hepatocytes, where Npc1 activity modulates cathepsin D expression and Abca1 protein translation rate.