Animal cells strictly control the distribution of cholesterol in their organelle membranes. This regulation requires an efficient machinery to transport insoluble cholesterol between organelles. In the present study, we generate an (125)I-labeled mutant version of Perfringolysin O (PFO), a cholesterol-binding protein, and use it to measure cholesterol in the plasma membrane of intact cells. We also purify plasma membranes from the same cells, which allows us to directly relate cholesterol concentration to (125)I-PFO binding. We show that cholesterol is organized in the plasma membrane in a manner that makes it inaccessible to PFO until its concentration exceeds a threshold of 35 mol% of total lipids. This 35% threshold is in striking contrast to the 5% threshold previously found for PFO binding to endoplasmic reticulum membranes. The (125)I-PFO probe also proved useful in monitoring the movement of LDL-derived cholesterol from lysosomes to plasma membranes. Using three different mutant cell lines, we show that this transport requires receptor-mediated uptake of LDL, hydrolysis of LDL-cholesteryl esters in lysosomes, and transfer of the liberated cholesterol to the plasma membrane.