Helical apolipoproteins interact with cellular surface and generate high density lipoprotein (HDL) by removing phospholipid and cholesterol from cells. We have reported that the HDL is generated by this reaction with the fetal rat astrocytes and meningeal fibroblasts but cholesterol is poorly available to this reaction with the astrocytes (Ito et al. 1999. J. Neurochem. 72: 2362;-2369). Partial digestion of the membrane by extracellular sphingomyelinase increased the incorporation of cholesterol into thus-generated HDL from both types of cell. This increase was diminished by supplement of endogenous or exogenous sphingomyelin to the cells. The sphingomyelinase treatment decreased cholesterol in the membrane mainly in the detergent-resisting domain. The intracellular cholesterol used by acylCoA:cholesterol acyltransferase increased by the sphingomyelinase treatment in the absence of apoA-I, more remarkably in the fibroblast than in the astrocytes. ApoA-I suppressed this increase completely in the astrocytes, but only partially in the fibroblast. The effect of the sphingomyelin digestion was more prominent for the apolipoprotein-mediated reaction than the diffusion-mediated cellular cholesterol efflux. Thus, cholesterol molecules restricted by sphingomyelin in the domain of the plasma membrane appear to be primarily used for the HDL assembly upon the apolipoprotein;-cell interaction.