The endoplasmic reticulum (ER)4 protein Scap is unique in nature because it serves as a cholesterol sensor that ensures the proper amount of cholesterol in membranes of animal cells (1, 2). The function of Scap derives from its ability to mediate the regulated transport of sterol regulatory element-binding proteins (SREBPs) from ER to Golgi. SREBPs are a family of three transcription factors that activate all of the genes necessary to produce cholesterol, fatty acids, and triglycerides (3). The SREBPs are synthesized as intrinsic transmembrane proteins of the ER. Immediately after their synthesis, the SREBPs bind to Scap, which serves as the nidus for incorporation into COPIIcoated vesicles, which bud from the ER and travel to the Golgi. There the SREBPs are processed sequentially by two proteases, thereby releasing the active transcriptional fragments that travel to the nucleus. When cholesterol accumulates in ER membranes, Scap binds the cholesterol and undergoes a conformational change that causes it to bind to Insig, an ER-resident protein (4). As a result of the conformational change and its stabilization by Insig (5), the Scap-SREBP complex is no longer incorporated into budding vesicles, and the active fragment cannot reach the nucleus. As a result, synthesis of cholesterol and fatty acids declines.The 1276 amino acids of Scap can be divided into two functional regions (see Fig. 1). The COOH-terminal domain of ϳ540 amino acids extends into the cytosol. It contains at least four WD repeat sequences that mediate its binding to SREBPs. The NH 2 -terminal region of ϳ735 amino acids is the membrane attachment domain. It contains eight ␣-helices separated by hydrophilic loops (6). Three of the loops (Loops 1, 6, and 7) are long enough to have significant structure. Helices 2-6 contain the Insig binding site (7,8). Loop 6, which faces the cytosol, contains the hexapeptide sequence MELADL, which serves as the binding site for the COPII proteins that cluster the Scap-SREBP complex into COPII-coated vesicles that bud from ER membranes (2, 9). When the cholesterol content of ER membranes exceeds a sharp threshold of 4 -5% of total lipids, the cholesterol binds to the membrane region of Scap (10), and this elicits a conformational change in Loop 6 that can be monitored by a protease protection assay (11). The change is reflected by the exposure of a novel arginine (Arg 505 ) to cleavage by trypsin (Fig. 1).The cholesterol-induced conformational change in Loop 6 causes the MELADL sequence to become inaccessible to COPII proteins, thereby precluding transport to the Golgi (2). Although the conformational change does not require Insig, binding to Insig stabilizes the inactive conformation, thereby lowering the threshold for cholesterol (10).Our previous cholesterol-binding studies were performed with a recombinant form of Scap that contained the entire membrane attachment domain (TM1-8) (1,12). Within this domain, the precise site of cholesterol binding was not established. In the current study, we localize the choleste...