Induction of cell cycle arrest in lymphocytes after exposure to the Aggregatibacter actinomycetemcomitans cytolethal distending toxin (Cdt) is dependent upon the integrity of lipid membrane microdomains. In this study we further demonstrate that the association of Cdt with lymphocyte plasma membranes is dependent upon binding to cholesterol. Depletion of cholesterol resulted in reduced toxin binding, whereas repletion of cholesterol-depleted cells restored binding. We employed fluorescence resonance energy transfer and surface plasmon resonance to demonstrate that toxin association with model membranes is dependent upon the concentration of cholesterol; moreover, these interactions were cholesterol-specific as the toxin failed to interact with model membranes containing stigmasterol, ergosterol, or lanosterol. Further analysis of the toxin indicated that the CdtC subunit contains a cholesterol recognition/interaction amino acid consensus (CRAC) region. Mutation of the CRAC site resulted in decreased binding of the holotoxin to cholesterol-containing model membranes as well as to the surface of Jurkat cells. The mutant toxin also exhibited reduced capacity for intracellular transfer of the active toxin subunit, CdtB, as well as reduced toxicity. Collectively, these observations indicate that membrane cholesterol serves as an essential ligand for Cdt and that this association can be blocked by either depleting membranes of cholesterol or mutation of the CRAC site. © 2009 by The American Society for Biochemistry and Molecular Biology, Inc.