Psoriasis is an immune-mediated inflammatory disease of the skin. Previous studies including ours have shown that IL-17A plays a major role in its pathogenesis; however, its precise molecular mechanism of action is not well understood. Cytokines like TNF α and IL-23 are also important in mediating the disease and some studies have also reported autophagy as a novel mechanism by which cytokines controls the immune response. Herein, we investigated the effect of IL-17A on autophagy and reveal crosstalk between autophagy and cholesterol signaling in keratinocytes. Our results suggest that IL-17A stimulated keratinocytes activated PI3K/AKT/mTOR signaling and inhibited autophagy by simultaneously inhibiting autophagosome formation and enhancing autophagic flux. Western blotting was utilized to detect the expression of autophagic markers (LC3 and p62), PI3K, mTOR and AKT. Induction of autophagy by mTOR inhibitor rapamycin and/or starvation also inhibited the levels of IL-17A secreted IL-8, CCL20 and S100A7 in keratinocytes. Herein, we also observed that inhibition of autophagy by IL-17A was accompanied by enhanced cellular cholesterol levels which in turn regulated the autophagic flux. To investigate crosstalk between autophagy and cellular cholesterol, we used methyl-β-cyclodextrin (MβCD), which disrupts detergent-insoluble microdomains (DIMs) by depleting cells of cholesterol and checked autophagy. Decreased expression of LC3-II in psoriatic lesional skin compared to non-lesional skin and induction of autophagy by anti-psoriatic drug methotrexate in keratinocytes further confirms the role of autophagy in psoriasis. Our findings suggest that modulators of autophagy and/or cholesterol levels may be developed, and also may lead to new therapeutic agents for psoriasis treatment.