Hepatic lipase-deficient subjects in the Ontario kindred are compound heterozygotes for hepatic lipase mutations (Ser$-$Phe and Thr$$Met). Cholesteryl ester-rich 0-very-low-density lipoprotein (β- VLDL) accumulates in plasma and such subjects have premature atherosclerosis. To determine a possible mechanism, we hypothesized that hepatic lipase-deficient 0-VLDL, homozygous for apolipoprotein (apo) E3, would cause cholesteryl ester accumulation and foam cell formation in macrophages. β-VLDL and pre-β-VLDL were isolated by Pevikon electrophoresis and incubated with J774 macrophages, cells that do not secrete apoE. 0-VLDL increased cellular cholesteryl ester content 13-fold, whereas pre-β-VLDL increased cholesteryl ester sevenfold. 0-VLDL increased acyl CoA: cholesterol acyltransferase activity fourfold (measured as [MC]oleate incorporation into cholesteryl ester). Preincubation of hepatic lipase-deficient β-VLDL with the anti-apoE monoclonal antibody 1D7, which inhibits binding of apoE to low-density lipoprotein receptors, inhibited cellular cholesteryl ester accumulation by 75%, whereas the anti-apoB blocking monoclonal antibody 5E11 failed to inhibit cellular cholesteryl ester accumulation. In contrast to hepatic lipase deficiency, β-VLDL from type in subjects (E2/E2) failed to increase cellular cholesteryl ester or acyl CoA: cholesterol acyltransferase more than 1.5-fold. Thus, hepatic lipasedeficient 0-VLDL readily induces cholesteryl ester accumulation in J774 macrophages, a process mediated by functional apoE3. This may explain the premature atherosclerosis observed in this kindred.