The cholesterol-lowering effect of lactic acid bacteria with high activity of bile salt hydrolase (BSH) is unclear. We believe that distinguishing BSH substrate specificity is necessary to study the effect of various BSH enzymes. We engineered a BSH mutant enzyme recombinant strain named F67A, which exclusively hydrolyzes taurocholic acid (TCA) using site-directed mutagenesis, and a previously lab-constructed BSH recombinant strain, YB81 that exclusively hydrolyzes glycocholic acid (GCA). We also constructed the recombinant strain named NB5462, which carries the empty pSIP411 plasmid and was used as a blank control strain. The intestinal flora in pseudo-germ-free (PGF) mice in which intestinal flora were eliminated via antibiotics, and F67A successfully reduced serum cholesterol levels in high-cholesterol diet-fed mice, whereas YB81 did not yield the same results. However, YB81 regained its cholesterol-lowering capacity in specific pathogen-free (SPF) mice with intact intestinal flora. The cholesterol-lowering mechanism of F67A involved modifying the bile acid pool through BSH enzyme activity. This adjustment regulated the expression of intestinal farnesoid X receptor and subsequently elevated hepatic cholesterol 7α-hydroxylase (CYP7A1), effectively reducing cholesterol levels. Conversely, GCA, the substrate of YB81, was found in minimal quantities in mice, preventing it from inducing changes in bile acid pools. In the presence of intestinal flora, the YB81 BSH enzyme induced notable alterations in bile acids by regulating changes in the intestinal flora and BSH within the flora, ultimately resulting in cholesterol reduction. This is the first study investigating the substrate specificity of BSH, demonstrating that different substrate-specific BSH enzymes exhibit cholesterol-lowering properties. Additionally, we elaborate on the mechanism of BSH-mediated enterohepatic axis regulation.