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NPC1L1 is the molecular target of the cholesterol lowering drug Ezetimibe and mediates the intestinal absorption of cholesterol. Inhibition or deletion of NPC1L1 reduces intestinal cholesterol absorption, resulting in reduction of plasma cholesterol levels.Here we present the 2.8 Å crystal structure of the N-terminal domain (NTD) of NPC1L1 in the absence of cholesterol. The structure, combined with biochemical data, reveals the mechanism of cholesterol selectivity of NPC1L1. Comparison to the cholesterol free and bound structures of NPC1(NTD) reveals that NPC1L1(NTD) is in a closed conformation and the sterol binding pocket is occluded from solvent.The structure of NPC1L1(NTD) reveals a degree of flexibility surrounding the entrance to the sterol binding pocket, suggesting a gating mechanism that relies on multiple movements around the entrance to the sterol binding pocket.