We describe a patient found to have acute diffuse and reversible encephalopathy on magnetic resonance imaging (MRI) associated with cholesterol emboli syndrome (CES). The initial MRI showed extensive white matter, basal ganglia and cortical damage without evidence of brain infarction. Dramatic clinical and MRI improvement was observed with corticosteroids. Pathologically, cholesterol crystal emboli were found in the lumen of skin and brain arteries and were associated with varying degrees of inflammation of the arteriole wall. This case suggests that CES may be responsible for extensive, acute and reversible encephalopathy underlined by an inflammation of brain arteries.