Microsomal preparations from normal human skin fibroblasts were used to investigate the role of free cholesterol in the endoplasmic reticulum in the control of cholesterol biosynthesis by regulation of 3-hydroxy-3-methylglutaryl-coenzyme A reductase (NADPH) [(S)-mevalonate:NADP+ oxidoreductase (CoA-acylating), EC 1.1.1.34]. Controlled changes in the cholesterol/phospholipid ratio of microsomes were introduced either in intact cells by incubating fibroblast cultures with whole serum or lipoprotein-deficient serum or by enrichment or depletion of cholesterol in microsomal preparations by incubating microsomes with cholesterol-rich or cholesterol-poor egg phosphatidylcholine unilamellar vesicles. Cholesterol enrichment resulted in suppression of reductase activity and increased ESR order parameters for 12-nitroxystearate in the microsomal preparations. Conversely, cholesterol depletion caused an activation of reductase and a decrease in order parameter. Enrichment of microsomal preparations with a "nonfluid" lipid, dipalmitoyl phosphatidylcholine, also suppressed enzyme activity and increased membrane order. The effect was reversed by subsequent enrichment of the microsomes with fluid egg phosphatidylcholine. Our findings suggest that cholesterol may regulate its own biosynthesis, at least in part, by suppression of hydroxymethylglutaryl-CoA reductase mediated through changes in membrane fluidity as measured by ESR order parameter.