Hepatocyte nuclear factor 4α (HNF4α) controls the expression of many critical metabolic pathways, and the Mediator complex occupies a central role in recruiting RNA polymerase II (Pol II) to these gene promoters. An impaired transcriptional HNF4α network in human liver is responsible for many pathological conditions, such as altered drug metabolism, fatty liver, and diabetes. Here, we report that Med25, an associated member of the Mediator complex, is required for the association of HNF4α with Mediator, its several cofactors, and RNA Pol II. Further, increases and decreases in endogenous Med25 levels are reflected in the composition of the transcriptional complex, Pol II recruitment, and the expression of HNF4α-bound target genes. A novel feature of Med25 is that it imparts "selectivity." Med25 affects only a significant subset of HNF4α target genes that selectively regulate drug and lipid metabolism. These results define a role for Med25 and the Mediator complex in the regulation of xenobiotic metabolism and lipid homeostasis.