Hepatocyte injury during cholestasis depends in part on the release of proinflammatory mediators that cause neutrophils to accumulate in the liver and become activated to damage hepatocytes. The mechanism by which cholestasis stimulates production of proinflammatory mediators in the liver is not completely understood. The studies presented here tested the hypothesis that the transcription factor early growth response factor-1 (Egr-1) is required for inflammation to occur in the liver during cholestasis. The results of these studies show that Egr-1 was rapidly upregulated, primarily in hepatocytes, in mice subjected to bile duct ligation, an animal model of cholestasis. To determine whether Egr-1 was required for inflammation and hepatocyte injury during cholestasis, bile duct ligation was performed in wild-type and Egr-1 knockout mice. Hepatocyte injury, neutrophil accumulation, and upregulation of macrophage inflammatory protein-2 (MIP-2) and intercellular adhesion molecule-1 (ICAM-1) in the liver were significantly reduced in Egr-1 knockouts. By contrast, levels of tumor necrosis factor-alpha (TNF-alpha) and collagen (i.e., a biomarker of liver fibrosis) were not different between wild-types and Egr-1 knockouts subjected to bile duct ligation. Because hepatocytes are exposed to elevated concentrations of bile acids during cholestasis, it was determined that bile acids upregulate Egr-1 in primary mouse hepatocytes. Deoxycholic acid dose-dependently increased Egr-1 protein in hepatocytes. Results from these studies suggest a scenario in which elevated concentrations of bile acids during cholestasis increase expression of Egr-1 in hepatocytes. Egr-1 then upregulates proinflammatory mediators that cause neutrophils to accumulate in the liver and become activated to damage hepatocytes.