Tyrosine phosphorylation of the high affinity immunoglobulin (Ig)E receptor (Fc epsilon RI) by the Src family kinase Lyn is the first known biochemical step that occurs during activation of mast cells and basophils after cross-linking of Fc epsilon RI by antigen. The hypothesis that specialized regions in the plasma membrane, enriched in sphingolipids and cholesterol, facilitate the coupling of Lyn and Fc epsilon RI was tested by investigating functional and structural effects of cholesterol depletion on Lyn/Fc epsilon RI interactions. We find that cholesterol depletion with methyl-beta-cyclodextrin substantially reduces stimulated tyrosine phosphorylation of Fc epsilon RI and other proteins while enhancing more downstream events that lead to stimulated exocytosis, In parallel to its inhibition of tyrosine phosphorylation, cholesterol depletion disrupts the interactions of aggregated Fc epsilon RI and Lyn on intact cells and also disrupts those interactions with detergent-resistant membranes that are isolated by sucrose gradient ultracentrifugation of lysed cells. Importantly, cholesterol repletion restores receptor phosphorylation together with the structural interactions. These results provide strong evidence that membrane structure, maintained by cholesterol, plays a critical role in the initiation of Fc epsilon RI signaling.