ERdj5 is a member of the protein disulfide isomerase family of proteins localized to the endoplasmic reticulum (ER) of mammalian cells. To date, only a limited number of substrates for ERdj5 are known. Here we identify a number of endogenous substrates that form mixed disulfides with ERdj5, greatly expanding its client repertoire. ERdj5 previously had been thought to exclusively reduce disulfides in proteins destined for dislocation to the cytosol for degradation. However, we demonstrate here that for one of the identified substrates, the low-density lipoprotein receptor (LDLR), ERdj5 is required not for degradation, but rather for efficient folding. Our results demonstrate that the crucial role of ERdj5 is to reduce non-native disulfides formed during productive folding and that this requirement is dependent on its interaction with BiP. Hence, ERdj5 acts as the ER reductase, both preparing misfolded proteins for degradation and catalyzing the folding of proteins that form obligatory non-native disulfides.