We recently demonstrated that although cholera toxin (CT) is found in detergent-insoluble domains/rafts at the cell surface of cultured hippocampal neurons, it is internalized via a raft-independent mechanism. Thus, cholesterol depletion by methyl-beta-cyclodextrin (MbetaCD) did not affect the rate of CT internalization from the plasma membrane, but did affect the rate of CT degradation, which occurs in lysosomes. In the current study, we analyze which step of CT intracellular transport is inhibited by MbetaCD. Whereas pre-incubation with MbetaCD completely blocked CT degradation, it had no effect on the degradation of wheat germ agglutinin (WGA) or bovine serum albumin (BSA), which are internalized by receptor-mediated and fluid phase endocytosis, respectively. Brefeldin A also completely blocked CT degradation but had no effect on WGA or BSA degradation. In contrast, MbetaCD did not affect CT degradation, or CT-mediated cAMP generation, when added to neurons after CT had been transported to the Golgi apparatus. We conclude that CT transport from endosomes to the Golgi apparatus is cholesterol-dependent, whereas CT transport from the Golgi apparatus to lysosomes is cholesterol-independent.