Overexpression of human apolipoprotein (apo) C-III in the plasma of transgenic mice results in hypertriglyceridemia, with up to a 20-fold elevation in plasma triglyceride. Nearly all of the triglyceride accumulates in the d < 1.006 g/ml lipoprotein fraction, which consists predominantly of apoB48-containing particles having a low apoE:apoB48 ratio in contrast to normal mice. The transgenic and nontransgenic d < 1.006 g/ml lipoproteins are similar in size, and they are equivalent substrates for lipoprotein lipase in vitro. Total apoB100 levels are similar in transgenic and normal plasma, but apoB48 levels are increased in transgenic mice. The transgenic d < 1.006 g/ml particles are poor competitors for the binding of low density lipoproteins to the low density lipoprotein receptor in vitro, which is corrected by the addition of exogenous apoE. The rate of clearance of labeled chylomicron remnants in apoC-III-transgenic mice was about half that in nontransgenic mice. The lipoprotein alterations are accompanied by up to a 5-fold increase in circulating nonesterified fatty acids, which may be the cause of fatty livers and increased liver triglyceride production also observed in the transgenic mice. These observations indicate that the primary defect leading to hypertriglyceridemia in apoC-III overexpressers is an impaired clearance of apoB48 remnants due to apoE insufficiency. Therefore, transgenic mice that overexpressed human apoE were cross-bred with the apoC-III overexpressers. Transgenic progeny that produced both human apoE and human apoC-III had normal levels of plasma triglyceride and normal amounts of apoB48 remnants. Thus, our studies suggest that a function of apoC-III is to modulate the apoE-mediated clearance of lipoproteins, and that the concentration of apoC-III relative to apoE is a key determinant of triglyceride levels in plasma.