Hemolytic anemia with cholesterol-rich, spur-shaped red cells has been described in adults with severe hepatocellular disease due to alcoholic cirrhosis. The red cell defect(elevated membrane CH content, without changes in PL content)is acquired from serum, and causes an increase in the microviscosity of membrane lipids. A 4½ year old girl with arteriohepatic dysplasia, intrahepatic cholestasis and cirrhosis developed progressive anemia(Hgb=5.8), reticulocytosis(21%), increasing jaundice (41 mgm/dl; 23 direct), and splenomegaly. Serum levels of iron, folate, Vit. B12 and E were normal. Peripheral smear showed fragmented cells and spur cells. Analysis of patient's fresh red cells revealed elevated CH(22.3 γ /108cells; N=14.5), normal PL(33.0γ/108cells; N=31.8), an increased CH/PL molar ratio (1.35; N=0.92), and an increase in microviscosity @ 37°(4.1 poise; N=3.0). Following incubation with the patient's plasma@ 37° for 24 hours, normal cells acquired the spur-shaped morphology with an associated decrease in osmotic fragility and a 25%increase in cholesterol content. Patient's cells incubated with normal plasma acquired morphological feature of spiculated spherocytes, with an increase in osmotic fragility and a 21% decrease in cholesterol content. CONCLUSION: These studies demonstrate that a process identical to spur-cell anemia in adults with alcoholic cirrhosis may accompany cirrhosis in children with intrahepatic cholestasis.