ATR-101 is a novel, oral drug candidate currently in development for the treatment of adrenocortical cancer. ATR-101 is a selective and potent inhibitor of acyl-coenzyme A:cholesterol O-acyltransferase 1 (ACAT1), an enzyme located in the endoplasmic reticulum (ER) membrane that catalyzes esterification of intracellular free cholesterol (FC). We aimed to identify mechanisms by which ATR-101 induces adrenocortical cell death. In H295R human adrenocortical carcinoma cells, ATR-101 decreases the formation of cholesteryl esters and increases FC levels, demonstrating potent inhibition of ACAT1 activity. Caspase-3/7 levels and terminal deoxynucleotidyl transferase 2'-deoxyuridine 5'-triphosphate nick end labeled-positive cells are increased by ATR-101 treatment, indicating activation of apoptosis. Exogenous cholesterol markedly potentiates the activity of ATR-101, suggesting that excess FC that cannot be adequately esterified increases caspase-3/7 activation and subsequent cell death. Inhibition of calcium release from the ER or the subsequent uptake of calcium by mitochondria reverses apoptosis induced by ATR-101. ATR-101 also activates multiple components of the unfolded protein response, an indicator of ER stress. Targeted knockdown of ACAT1 in an adrenocortical cell line mimicked the effects of ATR-101, suggesting that ACAT1 mediates the cytotoxic effects of ATR-101. Finally, in vivo treatment of dogs with ATR-101 decreased adrenocortical steroid production and induced cellular apoptosis that was restricted to the adrenal cortex. Together, these studies demonstrate that inhibition of ACAT1 by ATR-101 increases FC, resulting in dysregulation of ER calcium stores that result in ER stress, the unfolded protein response, and ultimately apoptosis.