We describe a metabolic defect in bile acid synthesis involving a deficiency in 7alpha-hydroxylation due to a mutation in the gene for the microsomal oxysterol 7alpha-hydroxylase enzyme, active in the acidic pathway for bile acid synthesis. The defect, identified in a 10-wk-old boy presenting with severe cholestasis, cirrhosis, and liver synthetic failure, was established by fast atom bombardment ionization-mass spectrometry, which revealed elevated urinary bile acid excretion, a mass spectrum with intense ions at m/z 453 and m/z 510 corresponding to sulfate and glycosulfate conjugates of unsaturated monohydroxy-cholenoic acids, and an absence of primary bile acids. Gas chromatography-mass spectrometric analysis confirmed the major products of hepatic synthesis to be 3beta-hydroxy-5-cholenoic and 3beta-hydroxy-5-cholestenoic acids, which accounted for 96% of the total serum bile acids. Levels of 27-hydroxycholesterol were > 4,500 times normal. The biochemical findings were consistent with a deficiency in 7alpha-hydroxylation, leading to the accumulation of hepatotoxic unsaturated monohydroxy bile acids. Hepatic microsomal oxysterol 7alpha-hydroxylase activity was undetectable in the patient. Gene analysis revealed a cytosine to thymidine transition mutation in exon 5 that converts an arginine codon at position 388 to a stop codon. The truncated protein was inactive when expressed in 293 cells. These findings indicate the quantitative importance of the acidic pathway in early life in humans and define a further inborn error in bile acid synthesis as a metabolic cause of severe cholestatic liver disease.