Oral administration of the HIV protease inhibitor L-689,502 caused cholestasis and hepatocyte injury in rats and dogs. These changes occurred rapidly, with elevations in serum transaminase observed as early as 6 hr after oral dosing in dogs. The acute phase of this hepatotoxic response was characterized in more detail in rats. Following intravenous administration, bile flow was decreased in a dose-dependent manner with greater than 90% decrease in less than 30 min at a dose of 5 mg/kg. The decrease in bile flow was associated with a decrease in erythritol clearance. The decrease in bile flow was not due to disruption of biliary tight junctions. Sucrose clearance was not increased and biliary bile acid concentrations in treated animals were not different from controls. Unlike control animals, bile flow was not stimulated by infusion of the bile acid tauroursodeoxycholic acid in animals treated with L-689,502. These cholestatic effects may be due, in part, to direct hepatocyte injury. Histological examination of perfusion-fixed livers 30 min after L-689,502 administration revealed periportal changes including hepatocyte vacuolation and occasional single cell necrosis. On a subcellular level, the nucleus and mitochondria were intact in less-severely affected cells. However, extensive vacuolation with multilamellar inclusions was pronounced in these cells. In addition, canalicular ectasia was also observed which was consistent with the cholestatic changes that were seen. In summary, L-689,502 is a potent, rapid acting hepatotoxin in dogs and rats. The mechanism by which this agent induces cholestasis is novel compared to other well-characterized cholestatic agents such as alpha-naphtylisothiocyanate and ethinyl estradiol.