The neutral detergent fiber (NDF) isolated from coconut kernel was digested with cellulase and hemicellulase and the residual fiber rich in hemicellulose (without cellulose) and cellulose (with out hemicellulose) were fed to rats and compared with a fiber free group. The results indicate that hemicellulose rich fiber showed decreased concentration of total cholesterol, LDL + VLDL cholesterol and increased HDL cholesterol, while cellulose rich fiber showed no significant alteration. There was increased HMG CoA reductase activity and increased incorporation of labeled acetate into free cholesterol. Rats fed hemicellulose rich coconut fiber produced lower concentration of triglycerides and phospholipids and lower release of lipoproteins into circulation. There was increased concentration of hepatic bile acids and increased excretion of faecal sterols and bile acids. These results indicate that the hemicellulose component of coconut fiber was responsible for the observed hypolipidemic effect.