Interferon-induced transmembrane proteins (IFITM1, 2 and 3) are important antiviral proteins that are active against many viruses, including influenza A virus (IAV), dengue virus (DENV), Ebola virus (EBOV), Zika virus (ZIKV) and severe acute respiratory syndrome coronavirus (SARS-CoV). IFITMs exhibit isoform-specific activity, but their distinct mechanisms of action and regulation are unclear. Since S -palmitoylation and cholesterol homeostasis are crucial for viral infections, we investigated IFITM interactions with cholesterol by molecular dynamic stimulations, nuclear magnetic resonance analysis in vitro and photoaffinity crosslinking in mammalian cells. These studies suggest that cholesterol can alter the conformation of IFITMs in membrane bilayers and directly interact with S -palmitoylated IFITMs in cells. Notably, we discovered that the S -palmitoylation levels regulate differential IFITM isoform interactions with cholesterol in mammalian cells and specificity of antiviral activity towards IAV, SARS-CoV-2 and EBOV. Our studies suggest that modulation of IFITM S -palmitoylation levels and cholesterol interaction may influence host susceptibility to different viruses.