OBJECTIVE Hepatic graft dysfunction is a major management problem in the early post-liver transplantation period. Our aims were to study how liver transplantation per se affects bile formation, and to investigate the role of cyclosporine in the pathogenesis of early graft dysfunction. METHODS Syngeneic liver transplantation used male Lewis rats. Two weeks after transplantation, the rats were randomly assigned to receive either daily subcutaneous injections of cyclosporine 10 mg/kg for 1 week (n=8), or daily saline injections (Placebo, n=8). 24-h bile collections were performed 18 h after the last injection. Eight non-transplanted rats served as controls. RESULTS Liver transplantation per se (Placebo) significantly increased basal bile flow (51%), particularly that portion which was bile salt-independent flow (81%), but did not impair bile salt kinetics or biliary lipid composition. Cyclosporine reduced basal bile flow and bile salt-independent flow by 41% and 30%, respectively. Bile salt synthesis was 52% suppressed, leading to a 22% decrease in the bile salt pool size. The recycling frequency of the bile salt pool was unaffected. The drug inhibited bile salt (37%) and phospholipid (23%) outputs; cholesterol secretion remained unaltered. This significantly elevated the cholesterol saturation of bile (25%). CONCLUSIONS Liver transplantation per se is choleretic and does not impair bile formation or lipid composition in this inbred rat model. Parenteral administration of high-dose cyclosporine induces cholestasis by inhibiting bile salt secretion and BSIF. Bile salt synthesis is down-regulated and the bile salt pool size decreased. The drug adversely affects biliary lipid composition by differential inhibition of bile salt and phospholipid outputs relative to an unchanged cholesterol secretion.