Mammalian cells obtain cholesterol via two pathways: endogenous synthesis in the endoplasmic reticulum and exogenous sources mainly through the low density lipoprotein (LDL) receptor pathway. We performed pulse-chase experiments to monitor the fate of endogenously synthesized cholesterol and showed that, after reaching the plasma membrane from the endoplasmic reticulum, the newly synthesized cholesterol eventually accumulates in an internal compartment in Niemann-Pick type C1 (NPC1) cells. Thus, the ultimate fate of endogenously synthesized cholesterol in NPC1 cells is the same as LDL-derived cholesterol. However, the time required for endogenous cholesterol to accumulate internally is much slower than LDL-derived cholesterol. Different pathways thus govern the post-plasma membrane trafficking of endogenous cholesterol and LDL-derived cholesterol to the internal compartment. Results using the inhibitor N-butyldeoxynojirimycin, which depletes cellular complex glycosphingolipids, demonstrates that the cholesterol trafficking defect in NPC1 cells is not caused by ganglioside accumulation. The ultimate cause of death in NPC disease is progressive neurological deterioration in the central nervous system, where the major source of cholesterol is derived from endogenous synthesis. Our current study provides a plausible link between defects in intracellular trafficking of endogenous cholesterol and the etiology of Niemann-Pick type C disease.