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Niemann-Pick disease type C （NPC） is an autosomal recessive lipid storage disorder characterized by chronic neurological deterioration associated with hepatomegaly, foam cell infiltration and a modest accumulation of sphingomyelin and cholesterol in certain tissues. The metabolic defect responsible for this disorder is not known. Disabled intracellular exogenous choles- terol esterification in NPC cultured skin fibroblasts has been recently reported. It has been suggest- ed that one cause of the deficient esterification is impaired intracellular transport of exogenous cho- lesterol. We have examined several aspects of the cholesterol metabolism in NPC cultured skin fibroblasts ; we observed a normal efflux of exogenous cholesterol from lysosomes and transport to the plasma membrane, and the unesterified cholesterol accumulated mainly in the plasma membrane as well as in the lysosomes and Golgi fraction. These observations indicate that plasma membrane cholesterol is not transported into the substrate pool of endoplasmic reticulum, where acyl-CoA : cholesterol acyltransferase is located. The uptake of exogenous cholesterol by NPC fibroblasts was markedly increased. According to the accumulation of cholesterol in NPC cells, sphingomyelinase was inhibited to 33.8%, and the peak of lysosomal enzyme activity was shifted toward the lighter range of the subcellular fraction. These results suggest that the low sphingomyelinase activity in NPC fibroblasts is the result of impaired lysosomal function by the accumulation of cholesterol.