We used compartmental modeling to describe taurocholate transport by isolated rat liver cells in suspension. Cells are preincubated in the presence of unlabeled taurocholate. When a steady-state for taurocholate is reached, radiolabeled taurocholate is added to the medium and its exchange kinetics between the medium and the cells are followed over time. Because the studies are performed under steady-state conditions, the kinetics can be described by linear compartmental models. We found a closed two-compartment model sufficient to describe the steady-state transport data. Simulations reveal that if the pools of free and bound intracellular taurocholate exchange rapidly, the cells will behave as a single, kinetically homogeneous compartment and intracellular events will not influence the exchange kinetics of taurocholate between the medium and the cells. The two-compartment model was used to study the concentration dependence of taurocholate transport by isolated cells. Steady-state transport rates and taurocholate concentrations in the medium and the cells were calculated using the model equations. Taurocholate influx, accumulation and efflux processes were studied simultaneously by examining the relationship between appropriate combinations of these variables. Application of this approach to study the inhibition of taurocholate transport by taurochenodeoxycholate is illustrated. In conclusion, this method provides a complementary approach to initial rate studies, which are generally used to investigate bile acid transport by isolated cells.