Neonatal hyperbilirubinemia or jaundice is associated with kernicterus, resulting in permanent neurological damage or even death. Conventional phototherapy does not prevent hyperbilirubinemia or eliminate the need for exchange transfusion. Here we investigated the potential of therapeutic bile acids ursodeoxycholic acid (UDCA) and obeticholic acid (OCA, 6-α-ethyl-CDCA), a farnesoid-X-receptor (FXR) agonist, as preventive treatment options for neonatal hyperbilirubinemia using the hUGT1*1 humanized mice and Ugt1a-deficient Gunn rats. Treatment of hUGT1*1 mice with UDCA or OCA at postnatal days 10-14 effectively decreased bilirubin in plasma (by 82% and 62%) and brain (by 72% and 69%), respectively. Mechanistically, our findings indicate that these effects are mediated through induction of protein levels of hUGT1A1 in the intestine, but not in liver. We further demonstrate that in Ugt1a-deficient Gunn rats, UDCA but not OCA significantly decreases plasma bilirubin, indicating that at least some of the hypobilirubinemic effects of UDCA are independent of UGT1A1. Finally, using the synthetic, non-bile acid, FXR-agonist GW4064, we show that some of these effects are mediated through direct or indirect activation of FXR. Together, our study shows that therapeutic bile acids UDCA and OCA effectively reduce both plasma and brain bilirubin, highlighting their potential in the treatment of neonatal hyperbilirubinemia.