Organization of lipids into membrane microdomains is a vital mechanism of protein processing. Here we show that overexpression of ERG6, a gene involved in ergosterol synthesis, elevates sterol levels 1.5-fold on the vacuole membrane and enhances their homotypic fusion. The mechanism of sterol-enhanced fusion is not via more efficient sorting, but instead promotes increased kinetics of fusion subreactions. We initially isolated ERG6 as a suppressor of a vrp1Δ growth defect selective for vacuole function. VRP1 encodes verprolin, an actin-binding protein that colocalizes to vacuoles. The vrp1Δ mutant has fragmented vacuoles in vivo and isolated vacuoles do not fuse in vitro, indicative of a Vrp1p requirement for membrane fusion. ERG6 overexpression rescues vrp1Δ vacuole fusion in a cytosol-dependent manner. Cytosol prepared from the vrp1Δ strain remains active; therefore, cytosol is not resupplying Vrp1p. Las17p (Vrp1p functional partner) antibodies, which inhibit wild-type vacuole fusion, do not inhibit the fusion of vacuoles from the vrp1Δ-ERG6 overexpression strain. Vacuole-associated actin turnover is decreased in the vrp1Δ strain, but recovered by ERG6 overexpression linking sterol enrichment to actin remodeling. Therefore, the Vrp1p/Las17p requirement for membrane fusion is bypassed by increased sterols, which promotes actin remodeling as part the membrane fusion mechanism.