Accurate diagnosis of lymphoid malignancies is essential for appropriate therapeutic intervention. In conjunction with other diagnostic determinants, immunophenotypic analysis of differentially expressed cell surface markers, such as CD5, CD20, CD23 and FMC7, is useful in the subclassification of lymphomas and leukemias arising from the B-cell lineage. Recent evidence suggesting that CD20 predicts FMC7 expression has prompted reappraisal of the utility of monitoring both markers. Here, we report that the FMC7 monoclonal antibody (mAb) specifically and strongly recognized CD20 ectopically expressed in hematopoietic and nonhematopoietic cell lines. The reactivity of FMC7 was abolished by mutations in the extracellular domain of CD20. These data confirm the CD20 specificity of FMC7. Like other CD20 mAbs, FMC7 binding was temperature dependent and induced detergent insolubility of CD20. Of significant interest, the CD20 epitope recognized by FMC7 was unusual in that it was exceptionally sensitive to membrane cholesterol. Cholesterol depletion profoundly reduced expression of the FMC7 epitope, whereas cholesterol enrichment enhanced its expression. FMC7 mAb binding thus appears to be a sensitive indicator of the level of plasma membrane cholesterol and reveals a conformational state of CD20 that is regulated by cholesterol.