In A431 cells, depletion of cholesterol with methyl-β-cyclodextrin induced an increase in both basal and epidermal growth factor (EGF)-stimulated EGF receptor phosphorylation. This increase in phosphorylation was site-specific, with significant increases occurring at Tyr845, Tyr992, and Tyr1173, but only minor changes at Tyr 1045 and Tyr1068. The elevated level of receptor phosphorylation was associated with an increase in the intrinsic kinase activity of the EGF receptor kinase, possibly as a result of the cyclodextrin-induced enhancement of the phosphorylation of Tyr845, a site in the kinase activation loop known to be phosphorylated by pp60 src. Cholesterol and its enantiomer (ent-cholesterol) were used to investigate the molecular basis for the modulation of EGF receptor function by cholesterol. Natural cholesterol (nat-cholesterol) was oxidized substantially more rapidly than ent-cholesterol by cholesterol oxidase, a protein that contains a specific binding site for the sterol. By contrast, the ability of nat- and ent-cholesterol to interact with sphingomyelins and phosphatidylcholine and to induce lipid condensation in a monolayer system was the same. These data suggest that, whereas cholesterol-protein interactions may be sensitive to the absolute configuration of the sterol, sterol-lipid interactions are not. nat- and ent-cholesterol were tested for their ability to physically reconstitute lipid rafts following depletion of cholesterol. nat- and ent-cholesterol reversed to the same extent the enhanced phosphorylation of the EGF receptor that occurred following removal of cholesterol. Furthermore, the enantiomers showed similar abilities to reconstitute lipid rafts in cyclodextrin-treated cells. These data suggest that cholesterol most likely affects EGF receptor function because of its physical effects on membrane properties, not through direct enantioselective interactions with the receptor.