High density lipoprotein (HDL) mediates reverse transport of cholesterol from atheroma foam cells to the liver, but the mechanisms of hepatic uptake and trafficking of HDL particles are poorly understood. In contrast to its accepted role as a cell surface receptor, scavenger receptor class B type 1 (SR-BI) is shown to be an endocytic receptor that mediates HDL particle uptake and recycling, but not degradation, in both transfected Chinese hamster ovary cells and hepatocytes. Confocal microscopy of polarized primary hepatocytes shows that HDL particles enter both the endocytic recycling compartment and the apical canalicular region paralleling the movement of SR-BI. In polarized epithelial cells (Madin-Darby canine kidney) expressing SR-BI, HDL protein and cholesterol undergo selective sorting with recycling of HDL protein from the basolateral membrane and secretion of HDL-derived cholesterol through the apical membrane. Thus, HDL particles, internalized via SR-BI, undergo a novel process of selective transcytosis, leading to polarized cholesterol transport. A distinct process not mediated by SR-BI is involved in uptake and degradation of apoE-free HDL in hepatocytes.