Lithium therapy is the therapeutic mainstay for bipolar disorder and has been associated in the thyroid with euthymic goiter, hyper and hypothyroidism as well as thyroid autoimmune disease. The FRTL-5 cell line is a well known model of thyroid cell physiology, where lithium has been shown to increase 3H-thymidine uptake at concentrations of 2 mM. This mitogenic effect was not associated with adenylate cyclase as measured by cyclic adenosine monophosphate (cAMP) production. The de novo synthesis of cholesterol is an important signal transduction pathway in FRTL-5 cells, where newly synthesized Rho GTPase is geranylgeranylated, enabling membrane localization of the G-protein and subsequent G1 to S-phase transition, resulting from extracellular stimulation. Here we confirm lithium mitogenicity at therapeutically relevant concentrations (1 mM) and demonstrate a lithium-associated accumulation of FRTL-5 cells in S-phase of the cell cycle. These effects could be abolished by Pravastatin, a potent inhibitor of 3-hydroxy-3-methylglutaryl coenzyme A (HMG-CoA), the rate-limiting enzyme in the formation of intermediates (de novo cholesterol synthesis) required for G-protein prenylation. Pravastatin, similar to lithium, showed no effect on cAMP production either under basal or thyroid stimulating hormone (TSH)-stimulated conditions indicating that de novo cholesterol synthesis is not involved with adenylate cyclase. The inhibitory effect of pravastatin could be overcome by reinitiating de novo cholesterol synthesis. This was achieved by the addition of the cell permeable, first metabolite (mevalonate) after HMG-CoA, which allowed the cycle to continue, leading eventually to protein prenylation, despite the presence of Pravastatin. These novel findings demonstrate lithium involvement in de novo cholesterol synthesis and G-protein prenylation, an important signal transduction pathway in FRTL-5 cells.