We examined the effects of reduction of sphingomyelin level on cholesterol behavior in cells using 2 types of Chinese hamster ovary cell mutants deficient in sphingomyelin synthesis: LY-A strain defective in intracellular trafficking of ceramide for sphingomyelin synthesis, and LY-B strain defective in the enzyme catalyzing the initial step of sphingolipid biosynthesis. Although the sphingomyelin content in LY-A and LY-B cells was approximately 40 and approximately 15%, respectively, of the wild-type level without accumulation of ceramide, these mutant cells were almost identical in cholesterol content and also in plasma membrane cholesterol level to the wild-type cells. However, density gradient fractionation analysis of Triton X-100-treated lysates of cells prelabeled with [(3)H]cholesterol showed that the [(3)H]cholesterol level in the low-density floating fraction was lower in sphingomyelin-deficient cells than in wild-type cells. When cells were exposed to methyl-beta-cyclodextrin, cholesterol was more efficiently fluxed from sphingomyelin-deficient cells than wild-type cells. These results suggest that the steady state level of cholesterol at the plasma membrane is little affected by the sphingomyelin levels in Chinese hamster ovary cells, but that sphingomyelin levels play an important role in the retention of cholesterol in the plasma membrane against efflux to extracellular cholesterol-acceptors, due to interaction between sphingomyelin and cholesterol in detergent-resistant membrane domains.