Nuclear receptor coactivator PBP (peroxisome proliferator-activated receptor (PPAR)-binding protein) functions as a coactivator for PPARs and other nuclear receptors. PBP serves as an anchor for TRAP (thyroid hormone receptor-associated proteins)/mediator multisubunit cofactor transcription complex. Disruption of the PBP/TRAP220 gene results in embryonic lethality around embryonic day 11.5 by affecting placental, cardiac, hepatic, and bone marrow development. Because PPAR isoforms alpha, gamma, and beta/delta function as important regulators of lipid homeostasis in mammals, it becomes important to assess the requirement of coactivator PBP in the regulation of PPAR functions in vivo. Sustained activation of PPARalpha by structurally diverse classes of chemicals of biological importance, designated peroxisome proliferators, leads to proliferation of peroxisomes in liver, induction of PPARalpha target genes including those involved in fatty acid oxidation, and the eventual development of liver tumors. Here, we show that targeted deletion of PBP in liver parenchymal cells, using the Cre-loxP system, results in the near abrogation of PPARalpha ligand-induced peroxisome proliferation and liver cell proliferation, as well as the induction of PPARalpha-regulated genes in PBP-deficient liver cells. In contrast, scattered PBP(+/+) hepatocytes in these livers showed DNA synthesis and were markedly hypertrophic with peroxisome proliferation in response to PPARalpha ligands. Chromatin immunoprecipitation data suggest that in PBP conditional null livers, there appears to be reduced association of cofactors, especially of CBP and TRAP150, to the mouse enoyl-CoA hydratase/l-3-hydroxyacyl-CoA dehydrogenase gene promoter. These observations suggest that PBP is required for the stabilization of multiprotein cofactor complexes. In essence, the absence of PBP in hepatocytes in vivo appears to mimic the absence of PPARalpha, indicating that coactivator PBP is essential for PPARalpha-regulated gene expression in liver parenchymal cells.