Unlike the livers of humans and mice, and most hepatoma cells, which accumulate triglycerides when treated with microsomal triglyceride transfer protein (MTP) inhibitors, L35 rat hepatoma cells do not express MTP and cannot secrete very low density lipoprotein (VLDL), yet they do not accumulate triglyceride. In these studies we show that transcriptional co-repression of the two lipid transfer proteins, liver fatty acid-binding protein (L-FABP) and MTP, which cooperatively shunt fatty acids into de novo synthesized glycerolipids and the transfer of lipids into VLDL, respectively, act together to maintain hepatic lipid homeostasis. FAO rat hepatoma cells express L-FABP and MTP and demonstrate the ability to assemble and secrete VLDL. In contrast, L35 cells, derived as a single cell clone from FAO cells, do not express L-FABP or MTP nor do they assemble and secrete VLDL. We used these hepatoma cells to elucidate how a conserved DR1 promoter element present in the promoters of L-FABP and MTP affects transcription, expression, and VLDL production. In FAO cells, the DR1 elements of both L-FABP and MTP promoters are occupied by peroxisome proliferator-activated receptor α-retinoid X receptor α (RXRα), with which PGC-1β activates transcription. In contrast, in L35 cells the DR1 elements of both L-FABP and MTP promoters are occupied by chicken ovalbumin upstream promoter transcription factor II, and transcription is diminished. The combined findings indicate that peroxisome proliferator-activated receptor α-RXRα and PGC-1β coordinately up-regulate L-FABP and MTP expression, by competing with chicken ovalbumin upstream promoter transcription factor II for the DR1 sites in the proximal promoters of each gene. Additional studies show that ablation of L-FABP prevents hepatic steatosis caused by treating mice with an MTP inhibitor. Our findings show that reducing both L-FABP and MTP is an effective means to reduce VLDL secretion without causing hepatic steatosis.