Bile acids regulate the cholesterol 7alpha-hydroxylase gene (CYP7A1), which encodes the rate-limiting enzyme in the classical pathway of bile acid synthesis. Here we report a novel mechanism whereby bile acid feedback regulates CYP7A1 transcription through the nuclear receptor hepatocyte nuclear factor-4 (HNF-4), which binds to the bile acid response element (BARE) at nt -149/-118 relative to the transcription start site. Using transient transfection assays of HepG2 cells with Gal4-HNF-4 fusion proteins, we show that chenodeoxycholic acid (CDCA) dampened the transactivation potential of HNF-4. Overexpression of a constitutive active form of MEKK1, an upstream mitogen-activated protein kinase (MAPK) module triggered by stress signals, strongly repressed the promoter activity of CYP7A1 via the consensus sequence for HNF-4 embedded in the BARE. Similarly, MEKK1 inhibited the activity of HNF-4 in the Gal4-based assay. The involvement of the MEKK1-dependent pathway in the bile acid-mediated repression of CYP7A1 was confirmed by co-transfecting a dominant negative form of the stress-activated protein kinase kinase, SEK, which abolished the effect of CDCA upon CYP7A1 transcription. Treatment of transfected HepG2 cells with tumor necrosis factor alpha (TNF-alpha), an activator of the MEKK1 pathway, led to the repression of CYP7A1 via the HNF-4 site in the BARE. TNF-alpha also inhibited the transactivation potential of HNF-4. Collectively, our results demonstrate for the first time that HNF-4, in combination with a MAPK signaling pathway, acts as a bile acid sensor in the liver. Furthermore, the effects of CDCA and TNF-alpha converge to HNF-4, which binds to the BARE of CYP7A1, suggesting a link between the cascades elicited by bile acids and pro-inflammatory stimuli in the liver.