The mechanism by which cholera toxin (CT) is internalized from the plasma membrane before its intracellular reduction and subsequent activation of adenylyl cyclase is not well understood. Ganglioside G_M1, the receptor for CT, is predominantly clustered in detergent-insoluble glycolipid rafts and in caveolae, noncoated, cholesterol-rich invaginations on the plasma membrane. In this study, we used filipin, a sterol-binding agent that disrupts caveolae and caveolae-like structures, to explore their role in the internalization and activation of CT in CaCo-2 human intestinal epithelial cells. When toxin internalization was quantified, only 33% of surface-bound toxin was internalized by filipin-treated cells within 1 h compared with 79% in untreated cells. However, CT activation as determined by its reduction to form the A₁ peptide and CT activity as measured by cyclic AMP accumulation were inhibited in filipin-treated cells. Another sterol-binding agent, 2-hydroxy-β-cyclodextrin, gave comparable results. The cationic amphiphilic drug chlorpromazine, an inhibitor of clathrin-dependent, receptor-mediated endocytosis, however, affected neither CT internalization, activation, nor activity in contrast to its inhibitory effects on diphtheria toxin cytotoxicity. As filipin did not inhibit the latter, the two drugs appeared to distinguish between caveolae- and coated pit–mediated processes. In addition to its effects in CaCo-2 cells that express low levels of caveolin, filipin also inhibited CT activity in human epidermoid carcinoma A431 and Jurkat T lymphoma cells that are, respectively, rich in or lack caveolin. Thus, filipin inhibition correlated more closely with alterations in the biochemical characteristics of CT-bound membranes due to the interactions of filipin with cholesterol rather than with the expressed levels of caveolin and caveolar structure. Our results indicated that the internalization and activation of CT was dependent on and mediated through cholesterol- and glycolipid-rich microdomains at the plasma membrane rather than through a specific morphological structure and that these glycolipid microdomains have the necessary components required to mediate endocytosis.