We determined the molecular mechanisms underlying apolipoprotein E (ApoE)-isoform-dependent lipid efflux from neurons and ApoE-deficient astrocytes in culture. The ability of ApoE3 to induce lipid efflux was 2.5- to 3.9-fold greater than ApoE4. To explore the contributions of the amino- and carboxyl-terminal tertiary structure domains of ApoE to cellular lipid efflux, each domain was studied separately. The amino-terminal fragment of ApoE3 (22-kDa-ApoE3) induced lipid efflux greater than 22-kDa-ApoE4, whereas the common carboxyl-terminal fragment of ApoE induced very low levels of lipid efflux. Addition of segments of the carboxyl-terminal domain to 22-kDa-ApoE3 additively induced lipid efflux in a length-dependent manner; in contrast, this effect did not occur with ApoE4. This observation, coupled with the fact that introduction of the E255A mutation (which disrupts domain-domain interaction) into ApoE4 increases lipid efflux, indicates that interaction between the amino- and carboxyl-terminal domains in ApoE4 reduces the ability of this isoform to mediate lipid efflux from neural cells. Dimeric 22-kDa or intact ApoE3 induced higher lipid efflux than monomeric 22-kDa or intact ApoE3, respectively, indicating that dimerization of ApoE3 enhances the ability to release lipids. The adenosine triphosphate-binding cassette protein A1 (ABCA1) is involved in ApoE-induced lipid efflux. In conclusion, there are two major factors, intramolecular domain interaction and intermolecular dimerization, that cause ApoE-isoform-dependent lipid efflux from neural cells in culture.