The major canalicular bile salt export pump (Bsep) of mammalian liver is downregulated by endotoxin. This study reports on the effects of dexamethasone and osmolarity on Bsep mRNA expression in cultured rat hepatocytes and its functional relevance in rat liver. Expression of Bsep mRNA in rat hepatocytes 24 and 48 h after isolation was dependent on the presence of dexamethasone (100 nM) in the culture medium. Bsep was functionally active at the pseudocanalicular membrane in cells cultured for 4 days in medium containing dexamethasone. Hypoosmolarity (205 mosmol/l) led to an induction of Bsep mRNA levels, whereas expression was decreased by hyperosmolarity (405 mosmol/l). Also the decay of Bsep mRNA following dexamethasone withdrawal was osmosensitive. In rat liver, dexamethasone counteracted the lipopolysaccharide (LPS)-induced down-regulation of Bsep mRNA levels after 12 hours and abolished the LPS-induced inhibition of taurocholate excretion. These results indicate that glucocorticoids are strong inducers of Bsep in liver. Furthermore, Bsep mRNA levels are osmosensitively regulated. The data suggest a longterm control of Bsep mRNA by osmolarity in addition to the short-term effects on canalicular bile acid excretion, which were reported recently.