Cholesterol metabolism is closely related to the occurrence and development of osteoporosis, but the exact mechanism remains unclear. Niemann-Pick C1-like 1 (NPC1L1) is one of the key cholesterol transporter proteins, however, there are few reports on the functions of NPC1L1 besides regulating cholesterol transport, let alone bone homeostasis. Our preliminary research indicated that NPC1L1 may play a negative regulatory role in osteogenic differentiation. In this study, using in vitro osteogenic differentiation experiment and mouse osteoporosis model, we showed here that NPC1L1 expression was downregulated during osteogenesis, and NPC1L1 knockdown significantly enhanced osteogenic differentiation ability of osteoblasts and delayed progress of osteoporosis. Mechanistically, through RNA sequencing, NPC1L1 was found regulate cholesterol metabolism rather than transportation. It increased 27- Hydroxycholesterol (27-OHC) level through activating 27-hydroxylase (Cyp27a1), resulting in 27-OHC accumulation in osteoblasts and inhibition of osteogenesis. Moreover, C/EBPα was proved mediated NPC1L1 promotes production of 27-OHC by Cyp27a1. These findings reveal that NPC1L1 inhibits osteogenesis and promotes osteoporosis via regulate cholesterol metabolism.