  We study the impact of the CP violation of the extra Higgs sector on $D^0$
decay. The CP even and CP odd neutral Higgs mixing of the two Higgs doublet
model is studied and we show how the CP violating effect of the mixing may lead
to the longitudinal muon polarization asymmetry of $D^0 \to \mu^+ \mu^-$. The
asymmetry of the short-distance contribution is sensitive to the CP violating
phase of the extended Higgs sector.
