Type II phosphatidylinositol 4-kinase IIalpha (PI4KIIalpha) is the dominant phosphatidylinositol kinase activity measured in mammalian cells and has important functions in intracellular vesicular trafficking. Recently PI4KIIalpha has been shown to have important roles in neuronal survival and tumorigenesis. This study focuses on the relationship between membrane cholesterol levels, phosphatidylinositol 4-phosphate (PI4P) synthesis, and PI4KIIalpha mobility. Enzyme kinetic measurements, sterol substitution studies, and membrane fragmentation analyses all revealed that cholesterol regulates PI4KIIalpha activity indirectly through effects on membrane structure. In particular, we found that cholesterol levels determined the distribution of PI4KIIalpha to biophysically distinct membrane domains. Imaging studies on cells expressing enhanced green fluorescent protein (eGFP)-tagged PI4KIIalpha demonstrated that cholesterol depletion resulted in morphological changes to the juxtanuclear membrane pool of the enzyme. Lateral membrane diffusion of eGFP-PI4KIIalpha was assessed by fluorescence recovery after photobleaching (FRAP) experiments, which revealed the existence of both mobile and immobile pools of the enzyme. Sterol depletion decreased the size of the mobile pool of PI4KIIalpha. Further measurements revealed that the reduction in the mobile fraction of PI4KIIalpha correlated with a loss of trans-Golgi network (TGN) membrane connectivity. We conclude that cholesterol modulates PI4P synthesis through effects on membrane organization and enzyme diffusion.