In the present study, we investigated the role of membrane cholesterol in the function of glutamate transporters. Depletion of membrane cholesterol by methyl-beta-cyclodextrin resulted in reduced Na(+)-dependent glutamate uptake in primary cortical cultures. Glial glutamate transporter EAAT2-mediated uptake was more sensitive to this effect. Cell surface biotinylation and immunostaining experiments revealed that the loss of cholesterol significantly altered the trafficking of EAAT2 to the plasma membrane as well as their membrane distribution. These effects were also observed in neuronal glutamate transporter EAAT3 but to a lesser extent. Furthermore, the treatment of mouse brain plasma membrane vesicles with methyl-beta-cyclodextrin resulted in a significant reduction in glutamate uptake, suggesting that cholesterol depletion has a direct effect on the function of the glutamate transporters. Plasma membrane cholesterol is localized within discreet microdomains known as lipid rafts. Analyses of purified lipid raft microdomains revealed that a large portion of total EAAT2 and a minor portion of total EAAT1, EAAT3, and EAAT4 were associated with lipid rafts. Artificial aggregation of lipid rafts in vivo resulted in the formation of larger EAAT2-immunoreactive clusters on the cell surface. The purified lipid raft-associated fractions were capable of Na(+)-dependent glutamate uptake. Our data suggest that the glutamate transporters, especially EAAT2, are associated with cholesterol-rich lipid raft microdomains of the plasma membrane and that the association with these cholesterol-rich microdomains is important for excitatory amino acid transporter localization and function.