Lipid peroxidation is an oxidative process in which free radicals lead to the degradation of membrane lipids. The prime action of oxidative reactions in biomembranes is to increase reactive oxygen species (ROS) and form fatty acid hydroperoxides. This leads to changes in membrane fluidity, disruption of plasma membrane integrity, and impairment of lipid-protein interactions that ultimately facilitate the modification of nucleic acids and proteins by the release of reactive aldehydes and bioactive products, thus disrupting gene transcription and signal transduction. Lipid peroxidation has been linked to a number of diseases such as Alzheimer's disease. However, the effects of lipid peroxidation on plasma membrane lipids and proteins are still incompletely understood. Therefore, we used giant plasma membrane vesicles (GPMVs) as a model system to examine lipid peroxidation-induced changes in plasma membrane phase behavior. In particular, we investigated how lipid peroxidation induced using a combination of Fe(II) and Cumene hydroperoxide alters membrane physical properties, especially lipid rafts (Lo) and non-raft (Ld) phases. We find that lipid peroxidation causes dramatic enhancement of phase separation at room temperature that is accompanied by a significant increase in the fraction of the non-raft phase. These effects were concentration dependent, and similar results were observed in GPMVs derived from different cell types. Interestingly, lipid peroxidation also decreased the affinity of the model raft protein YFP-GL-GPI for raft domains, indicating that protein composition of membrane domains is also impacted by lipid peroxidation. Taken together, these findings highlight the utility of this approach to study the impact of lipid peroxidation on cell membranes and suggest a potential mechanism by which lipid peroxidation can influence cellular functions.