We have previously shown that transgenic expression of catalytically inactive lipoprotein lipase (LPL) in muscle (Mck-N-LPL) enhances triglyceride hydrolysis as well as whole particle lipoprotein and selective cholesterol ester uptake. In the current study, we have examined whether these functions can be performed by inactive LPL alone or require the presence of active LPL expressed in the same tissue. To study inactive LPL in the presence of active LPL in the same tissue, the Mck-N-LPL transgene was bred onto the heterozygous LPL-deficient (LPL1) background. At 18 h of age, Mck-N-LPL reduced triglycerides by 35% and markedly increased muscle lipid droplets. In adult mice, it reduced triglycerides by 40% and increased lipoprotein particle uptake into muscle by 60% and cholesterol ester uptake by 110%. To study inactive LPL alone, the Mck-N-LPL transgene was bred onto the LPL-deficient (LPL0) background. These mice die at approximately 24 h of age. At 18 h of age, in the absence of active LPL, inactive LPL expression did not diminish triglycerides nor did it result in the accumulation of muscle lipid droplets. To study inactive LPL in the absence of active LPL in the same tissue in adult animals, the Mck-N-LPL transgene was bred onto mice that only expressed active LPL in the heart (LPL0/He-LPL). In this case, Mck-N-LPL did not reduce triglycerides or increase the uptake of lipoprotein particles but did increase muscle uptake of chylomicron and very low density lipoprotein cholesterol ester by 40%. Thus, in the presence of active LPL in the same tissue, inactive LPL augments triglyceride hydrolysis and increases whole particle triglyceride-rich lipoprotein and selective cholesterol ester uptake. In the absence of active LPL in the same tissue, inactive LPL only mediates selective cholesterol ester uptake.