Studies of 14 North American Indian children with a familial type of severe neonatal cholestasis are described. Jaundice occurred during the neonatal period in 9 children, but disappeared before the end of the 1st yr. Progressive liver damage was documented by the persistence of high levels of alkaline phosphatase, moderate elevation of transaminases, and severe pruritus. Serum bile acids were constantly elevated (3.0-119.5 microgram/ml). Early portal hypertension and variceal bleeding necessitated portal-systemic shunts in 7 children. By light microscopy, the early stage was characterized by hepatitis with giant-cell transformation and biliary stasis. Later on, portal fibrosis became evident and was followed by cirrhosis. By electron microscopy bile canaliculi appeared slightly dilated with preservation or only partial loss of microvilli. They were surrounded by a prominent pericanalicular filamentous web. Immunofluorescence studies indicated the presence of action-containing microfilaments. This group of children might represent a human model of microfilament dysfunction-induced cholestasis.