We studied the effect of ursodeoxycholic acid on 18 women and 2 men with primary biliary cirrhosis, mainly stages I and II. After a 3-mo observation period, patients were randomized to a 9-mo treatment period with ursodeoxycholic acid, 10 mg/kg.day, or placebo. Two patients on placebo left the study. In all patients on ursodeoxycholic acid, mean values of serum glutamate dehydrogenase, aspartate and alanine aminotransferases, alkaline phosphatase, and gamma-glutamyl transpeptidase fell significantly by 48%-79% after 18-24 wk; 7 of 10 showed a mean decrease of 35% in immunoglobulin M after 24 wk. Prothrombin time, serum bilirubin, albumin, the antipyrin breath test, and plasma disappearance of indocyanine green were normal initially and did not change. Total serum bile acid concentrations increased; ursodeoxycholic acid became the predominant bile acid. No significant improvement occurred in the placebo group. Hepatic histology improved in 6 patients of the ursodeoxycholic acid group but deteriorated in 4 patients receiving placebo. In studies with erythrocyte membranes, changes in electron spin resonance revealed that ursodeoxycholic acid was less toxic than chenodeoxycholic or deoxycholic acid, and coaddition of ursodeoxycholic acid prevented their toxic effect.