Aberrant cholesterol homeostasis is a well-recognized hallmark of cancer and is implicated in metastasis as well as chemotherapeutic resistance, the two major causes of cancer associated mortality. Liver X receptors (LXRs) are the key transcription factors that induce cholesterol efflux via enhancing the expression of ABCA1 and ABCG1. Therefore, a comprehensive analysis of several novel sterols namely ergosta-7,22,24(28)-trien-3β-ol (Erg1), ergosta-5,22,25-trien-3-ol (Erg2), ergosta-5,7,22,24(28)-tetraen-3β-ol (Erg3), and ergosta-7,22-dien-3β-ol (Erg4) as LXR agonists has been performed. Molecular docking studies have shown that these sterols possess higher binding affinities for LXRs as compared to the reference ligands (GW3965 and TO901317) and also formed critical activating interactions. Molecular dynamic (MD) simulations further confirmed that docking complexes made of these sterols possess significant stability. To assess the extent of LXR activation, ABCA1 promoter was cloned into luciferase reporter plasmid and transfected into HCT116 cells. It was observed that treatment with Erg, Erg2 and Erg4 led to a significant LXR activation with an EC50 of 5.64 µM, 4.83 and 3.03 µM respectively. Furthermore, a significant increase in mRNA expression of NR1H2 and LXR target genes i.e. ABCA1, ABCG1 and ApoE was observed upon Erg treatment. Flow cytometric analysis have revealed a significant increase in the accumulation of ABCA1 upon Erg treatment. Cytotoxicity studies conducted on colorectal cancer cell and normal epithelial cell line showed that these sterols are selectively toxic towards cancer cells. Taken together, our findings suggests that ergosterol activates LXRs, have significant anticancer activity and could be a likely candidate to manage aberrant cholesterol homeostasis.