During endochondral ossification, growth plate chondrocytes release plasma membrane (PM) derived matrix vesicles (MV), which are the site of initial hydroxyapatite crystal formation. MV constituents which facilitate the mineralization process include the integral membrane ectoenzymes alkaline phosphatase (ALPase) and nucleotide pyrophosphatase phosphodiesterase (NPP1/PC-1), along with a phosphatidylserine-(PS-) rich membrane surface that binds annexins and calcium, resulting in enhanced calcium entry into MV. In this study, we determined that chick growth plate MV were highly enriched in membrane raft microdomains containing high levels of cholesterol, glycophosphatidylinositol- (GPI-) anchored ALPase, and phosphatidylserine (PS) localized to the external leaflet of the bilayer. To determine how such membrane microdomains arise during chondrocyte maturation, we explored the role of PM cholesterol-dependent lipid assemblies in regulating the activities of lipid translocators involved in the externalization of PS. We first isolated and determined the composition of detergent-resistant membranes (DRMs) from chondrocyte PM. DRMs isolated from chondrocyte PM were enhanced in ganglioside 1 (GM1) and cholesterol as well as GPI-anchored ALPase. Furthermore, these membrane domains were enriched in PS (localized to the external leaflet of the bilayer) and had significantly higher ALPase activity than non-cholesterol- enriched domains. To understand the role of cholesterol-dependent lipid assemblies in the externalization of PS, we measured the activities of two lipid transporters involved in PS externalization, aminophospholipid translocase (APLT) and phospholipid scramblase (PLSCR1), during maturation of a murine chondrocytic cell line, N1511. In this report, we provide the first evidence that maturing chondrocytes express PLSCR1 and have scramblase activity. We propose that redistribution of PS is dependent on an increase in phospholipid scramblase activity and a decrease in APLT activity. Lastly, we show that translocator activity is most likely to be modulated by membrane cholesterol levels through a membrane raft microdomain. © 2006 American Chemical Society.