Phytosterols are structurally similar to cholesterol but they are much less absorbed (<2%) than cholesterol (>50%) in the intestine. We hypothesize that phytosterols are poor substrates of intestinal acyl-CoA: cholesterol acyltransferase 2 (ACAT2), and thus minimal phytosterol esters are formed and packed into chylomicrons, leading to their low absorption. Two isotope tracing models, including a radioactive hamster microsomal ACAT2 reaction model and a differentiated Caco-2 cell model, were established to examine the specificity of ACAT2 to various sterols, including cholesterol, sitosterol, stigmasterol, and campesterol. Both models consistently demonstrated that only cholesterol but not phytosterols could be efficiently esterified by ACAT2 in a time- and dose-dependent manner. Molecular docking further suggested that unfavorable interactions existed between ACAT2 and phytosterols. In conclusion, phytosterols are poor substrates of ACAT2 and thus minimally absorbed. This work provides a theoretical basis for the use of phytosterol-based supplements in treating dyslipidemia and preventing heart diseases. Display omitted •An “esterification theory” is proposed to explain sterol absorption selectivity.•Phytosterols, unlike cholesterol, are poor substrates for hamster intestinal ACAT2.•Caco-2 cells can only efficiently esterify cholesterol but not plant sterols.•Unfavorable interactions may exist between ACAT2 and phytosterols.•ACAT2 limits the esterification and thus the absorption of phytosterols.