The accumulation of cholesterol esters in foam cells of the arterial intima is an important characteristic of fatty streak lesions of atherosclerosis. We wished to know if cholesterol ester accumulations in cells could be mobilized by altering their external milieu. Thus, phospholipid dispersions were used to remove cholesterol from a cholesterol ester-enriched cell line. Rat hepatoma cells, Fu5AH, were loaded with cholesterol esters by incubation in medium supplemented with hyperlipemic rabbit serum. After removing the loading medium, we incubated the cells in serum-free medium containing egg phosphatidylcholine dispersions. Unesterified cellular cholesterol level decreased in the first 4 h and then remained at a constant level. The cholesterol esters decreased after a lag time of about 2 h and the triacylglycerol level increased after 3 h. The decrease in cellular cholesterol ester depended on the amount of phospholipid in the medium. Cellular cholesterol ester decreased with increasing concentration of medium phospholipid to 2 mumols/ml and then plateaued. The removed cellular sterols appeared in the medium as free cholesterol. Since there was no measurable cholesterol esterase activity in the medium, the cholesterol ester in the cells was hydrolyzed before it appeared in the medium. The fatty acyl composition of the cellular cholesterol esters remained unchanged after significant reduction, suggesting that the hydrolysis of cholesterol esters was not specific for the acyl chain. Sphingomyelin and dimyristoyl phosphatidylcholine dispersions, though cytotoxic, were also effective in reducing cellular cholesterol esters. These experiments demonstrate that cholesterol ester accumulations in these cells can be reduced when phospholipid dispersions are used as cholesterol acceptors in the extracellular medium.