Bile acid homeostasis is crucial for the normal physiological functioning of the liver. Disruptions in bile acid profiles are closely linked to the occurrence of cholestatic liver injury. As part of our diagnostic and therapeutic approach, we aimed to investigate the disturbance in bile acid profiles during cholestasis and its correlation with cholestatic liver injury. Before the occurrence of liver injury, alterations in bile acid profiles were detected in both plasma and liver between 8 and 16 h, persisting up to 96 h. TCA, TCDCA, and TUDCA in the plasma, as well as TCA, TUDCA, TCDCA, TDCA, TLCA, and THDCA in the liver, emerged as early sensitive and potential markers for diagnosing ANIT‐induced cholestasis at 8–16 h. The distinguishing features of ANIT‐induced liver injury were as follows: T‐BAs exceeding G‐BAs and serum biochemical indicators surpassing free bile acids. Notably, plasma T‐BAs, particularly TCA, exhibited higher sensitivity to cholestatic hepatotoxicity compared with serum enzyme activity and liver histopathology. Further investigation revealed that TCA exacerbated ANIT‐induced liver injury by elevating liver function enzyme activity, inflammation, and bile duct proliferation and promoting the migration of bile duct epithelial cell. Nevertheless, no morphological changes or alterations in transaminase activity indicative of liver damage were observed in the rats treated with TCA alone. Additionally, there were no changes in bile acid profiles or inflammatory responses under physiological conditions with maintained bile acid homeostasis. In summary, our findings suggest that taurine‐conjugated bile acids in both plasma and liver, particularly TCA, can serve as early and sensitive markers for predicting intrahepatic cholestatic drugs and can act as potent exacerbators of cholestatic liver injury progression. However, exogenous TCA does not induce liver injury under physiological conditions where bile acid homeostasis is maintained.