Caveolae are clathrin-free cell-surface organelles implicated in transmembrane transport. A fibroblast caveolar membrane fraction was isolated by sucrose density gradient ultracentrifugation and its identity confirmed by protein markers (caveolin, annexin II). When 3H-labeled free cholesterol was selectively transferred to the cells from labeled low density lipoprotein to increase cell free cholesterol approximately 15%, there was a 6-fold increase in label in the caveolar fraction above baseline levels. Subsequent incubation of these cells with unlabeled native plasma or plasma high density lipoprotein selectively unloaded caveolar free cholesterol into the medium. Okadaic acid, which decreased caveolar activity as measured by cholera toxin binding and uptake, decreased cholesterol efflux in parallel. Cholesterol newly synthesized from [3H]mevalonate was also preferentially incorporated into the caveolar fraction and selectively released by plasma into the medium. Together these data indicate that caveolae represent a major site of efflux of both newly synthesized and low density lipoprotein-derived free cholesterol in these cells.