Previous studies have demonstrated that in intact animals, de novo cholesterol synthesis is increased in the small and large intestines of streptozotocin-induced diabetic rats. The aim of this study was to determine if this enhanced intestinal cholesterol synthesis in diabetic animals results in the increased transport of newly synthesized sterols from the intestines to the peripheral circulation. Thoracic ducts were cannulated in control and diabetic animals and the quantity of newly labeled sterols in the lymph determined after the administration of tritiated water. Labeled sterols in the 24-hour lymph drainage were increased fourfold in the diabetic animals as compared to control animals. Additionally, the percentage of newly synthesized sterols synthesized in the small intestine and transported by the lymph is almost twofold greater in the diabetics. Thus, the increased quantity of labeled sterols present in the thoracic duct lymph of diabetic animals is accounted for by two factors, an enhancement of small intestinal sterol synthesis in diabetic animals and the increased percentage transport of newly synthesized sterols from the small intestine to the bloodstream. In both control and diabetic animals, chylomicrons were the major lipoprotein fraction in which the newly synthesized sterols were transported in the lymph. These findings demonstrate that the increased sterologenesis observed in the intestine of diabetic animals results in the increased transport of newly synthesized cholesterol from the intestines to the circulation.