Primary sclerosing cholangitis (PSC), a rare chronic cholestatic liver disease, is characterized by intrahepatic or extrahepatic strictures accompanied by biliary fibrosis. So far, there are no effective therapies to slow down the progression of this disease. Farnesoid X receptors (FXRs) are ligand-activated transcription factors involved in the control of bile acid (BA) synthesis and enterohepatic circulation. Therefore, targeting FXRs holds promise as a potential approach for treating PSC. Pediococcus pentosaceus Li05 is a probiotic that was isolated from healthy volunteers and has previously been shown to have an anti-inflammatory effect in DSS-induced colitis. In this study, we established a 3,5-diethoxycarbonyl-1,4-Dihydrocollidine (DDC)-induced cholestasis mouse model and investigated the effects of Pediococcus pentosaceus Li05 on PSC. Our findings revealed that administration of Li05 significantly attenuated liver damage, hepatic inflammation, and fibrosis, as well as bile duct hyperplasia. Li05 activated the hepatic FXR-SHP and ileal FXR-FGF15 signaling pathways to decrease the expression of Cyp7a1. In addition, the Li05-modulated gut microbiota structure especially improved the abundance of 7α-dehydroxylation bacteria like Eubacterium. The intervention of Li05 also improved the intestinal barrier and reduced bacterial endotoxin translocation. Based on these findings, Li05 shows promise for future application as a therapeutic strategy for cholestasis.