Chinese hamster ovary cell mutants defective in the NPC1 gene (NPC1-trap) were generated by retrovirus-mediated gene trap mutagenesis from a parental cell line JP17 expressing an ecotropic retrovirus receptor. Insertion of the gene trap vector in the NPC1 gene and the absence of the gene product were verified by 5'RACE and immunological analyses, respectively. NPC1-trap cells showed intracellular accumulation of low-density lipoprotein (LDL)-derived cholesterol and had an increased level of unesterified cellular cholesterol. Cholesterol biosynthesis through the mevalonate pathway was upregulated in the mutant cells as assessed by [(14)C]acetate incorporation into cellular sterols. When JP17 cells were depleted of lipoproteins and then loaded with LDL, cell surface LDL receptors were promptly downregulated and the mature form of the sterol regulatory element-binding protein-1 disappeared from the nucleus. These responses to LDL were obviously retarded in NPC1-trap cells, suggesting an impaired response of the cholesterol-regulatory system to LDL. NPC1-trap cells will be a useful tool to study the regulation of cellular cholesterol homeostasis and the pathogenesis of Niemann-Pick disease type C.