Cholesterol esterification was examined in cultured skin fibroblasts from patients with I-cell disease and pseudo-Hurler polydystrophy by incubating cells pretreated without fetal calf serum for 48h, with (14C) cholesterol for 24h. Impaired cholesterol esterification was found in these cells and free cholesterol was accumulated in plasma membrane and Golgi fractions. This impairment was also induced in control cells by adding leupeptin (20 micrograms/ml) or monensin (2 micrograms/ml). These findings suggest the importance of the role of lysosomes for esterification of cholesterol and give a hint as to the basic defect in type C Niemann-Pick disease.