Eicosapentaenoic acid (EPA) is known to lower plasma cholesterol level and triglycerides, but its precise molecular mechanisms have not been reported. The objective of this study was to determine the mechanism of action of EPA in lowering plasma cholesterol and triglyceride levels. In this study, we found that long-term, highly purified EPA administration effectively reduced plasma and hepatic cholesterol levels in wild-type mice but not in peroxisome proliferator-activated receptor alpha (PPARalpha)-null mice. The significant down-regulation was detected at the transcriptional level on genes involved in cholesterol biosynthesis and cholesterol efflux in the liver only in wild-type mice. Limited changes were found in molecules involved in lipoprotein assembly and uptake, intracellular cholesterol transport, bile acid biosynthesis, and bile secretion. Transcription factors regulating cholesterol homeostasis were insignificantly modulated by the EPA treatment, except for sterol response element-binding protein-2 (SREBP-2). Based on these findings, EPA potentially lowers the plasma cholesterol levels by suppressing gene expression of cholesterol biosynthesis enzymes and a cholesterol efflux protein from the liver. In mature SREBP-2, processing ability appears to play an important role in the presence of PPARalpha. Our study provides novel evidence of an additional rationale for the use of EPA in the prevention and treatment of hypercholesterolemia.