4β-Hydroxycholesterol (4β-HC) in plasma has been used as a biomarker to assess CYP3A drug–drug interaction (DDI) potential during drug development. However, due to the long half-life and narrow dynamic range of 4β-HC, its use has been limited to the identification of CYP3A inducers, but not CYP3A inhibitors. The formation of 1β-hydroxydeoxycholic acid (1β-OH DCA) from deoxycholic acid (DCA) is mediated by CYP3A, thus 1β-OH DCA can potentially serve as an alternative to 4β-HC for assessment of CYP3A DDI potential. To study this feasibility, we developed a sensitive liquid chromatography–tandem mass spectrometry method for the simultaneous quantitation of 1β-OH DCA and its glycine and taurine conjugates in human plasma with the lower limit of quantitation of 50 pg/ml, which enabled the quantitation of basal levels and further reduction. The method was applied to a DDI study to assess how 1β-OH DCA and its glycine and taurine conjugates would respond to CYP3A induction or inhibition. Rifampin induction resulted in an increase of 1β-OH DCA and its conjugates in plasma, with 6.8-, 7.8-, 8.3-, and 10.3-fold increases of area under the curve from the time of dosing to the last measurable concentration (AUC_LST), area under the curve from the time of dosing to 24 hours (AUC_24h), C_max, and mean concentrations for total 1β-OH DCA (total of all three forms), respectively. Importantly, inhibition with itraconazole resulted in notable reduction of these biomarkers, with 84%, 85%, 82%, and 81% reductions of AUC_LST, AUC_24h, C_max, and mean concentrations for total 1β-OH DCA, respectively. These preliminary data demonstrate for the first time that total 1β-OH DCA in plasma has the potential to serve as a biomarker for CYP3A DDI assessment in early clinical development and may provide key advantages over 4β-HC.