Hepatic neutral cytosolic cholesteryl ester hydrolase (hncCEH) is a key enzyme in the regulation of hepatic free cholesterol (FC). In examining the effects of over-expression of this enzyme on cholesterol homeostasis, mice were infected with a recombinant adenovirus construct (AdCEH) of the rat hncCEH cDNA driven by the human cytomegalovirus promoter. Cholesteryl esterase and p-nitrophenylcaprylate (PNPC) esterase activities were measured in liver postmitochondrial supernatants at 1, 3, 7, and 11 d after infection with AdCEH or a control virus expressing beta-galactosidase (AdbetaGAL). The PNPC esterase activity of AdCEH mice peaked threefold higher than controls on day 2, declining on subsequent days. In contrast, cholesteryl esterase peaked eightfold higher than controls on day 3, indicating a shift in substrate selectivity of hncCEH. Hepatic FC peaked at 144% of controls, 7 d postinfection. The mRNAs for cholesterol 7alpha-hydroxylase, sterol 27-hydroxylase, and HMG-CoA reductase decreased to 47, 46, and 58% of controls, respectively, on day 7, coinciding with peak FC concentrations. Coinciding with increased cholesteryl esterase activity, hepatic esterified cholesterol dropped precipitously from day 3 onward, to 11% of controls by day 11. Hepatic TAG levels also declined, consistent with the reported TAG lipase activity of hncCEH. These results demonstrate elevation of FC and depletion of cholesteryl esters by over-expression of hncCEH, which were resistant to compensatory responses by other enzymes of cholesterol homeostasis.