Biliary lipid secretion is an important physiological event; not only for the disposal of cholesterol from the body, but also for the protection of cells lining the biliary tree against bile salts. Insight into the (patho)physiological role of biliary lipid secretion has been recently expanded through the study of a generation of mice with a disruption of the Mdr2 gene, who do not secrete lipids into bile. Mdr2 P-glycoprotein translocates phospholipids across the hepatocanalicular membrane. These animals suffer from progressive liver disease caused by the toxic detergent action of bile salts. Very recently, it has become clear that an analogous inherited human liver disease exists, which is caused by the absence of biliary lipid secretion. Patients with this disease, Progressive Familial Intrahepatic Cholestasis (PFIC) type 3, have a mutation in the MDR3 gene, which is the human homologue of the murine Mdr2 gene.