Studies in cultured fibroblasts indicate that the primary genetic abnormality in familial hypercholesterolemia involves a deficiency in a cell surface receptor for low density lipoproteins (LDL). In normal cells, binding of LDL to this receptor regulates cholesterol metabolism by suppressing cholesterol synthesis and increasing LDL degradation. In cells from heterozygotes, a 60 percent reduction in LDL receptors leads to a concentration-dependent defect in regulation, so that attainment of equal rates of cholesterol synthesis and LDL degradation in normal and heterozygous cells requires a two- to threefold higher concentration of LDL in the heterozygote. The identification of this genetic regulatory defect in fibroblasts of heterozygotes makes available an in vitro system for studying the effects of a dominant mutation on gene expression in mammalian cells.