D-threo-1-phenyl-2-decanoylamino-3-morpholino-1-propanol (D-PDMP) is a frequently used inhibitor of glycosphingolipid biosynthesis. However, some interesting characteristics of D-PDMP cannot be explained by the inhibition of glycolipid synthesis alone. In the present study, we showed that d-PDMP inhibits the activation of lysosomal acid lipase by late endosome/lysosome specific lipid, bis(monoacylglycero)phosphate (also called as lysobisphosphatidic acid), through alteration of membrane structure of the lipid. When added to cultured fibroblasts, D-PDMP inhibits the degradation of low-density lipoprotein (LDL) and thus accumulates both cholesterol ester and free cholesterol in late endosomes/lysosomes. This accumulation results in the inhibition of LDL-derived cholesterol esterification and the decrease of cell surface cholesterol. We showed that D-PDMP alters cellular cholesterol homeostasis in a glycosphingolipid-independent manner using L-PDMP, a stereoisomer of D-PDMP, which does not inhibit glycosphingolipid synthesis, and mutant melanoma cell which is defective in glycolipid synthesis. Altering cholesterol homeostasis by D-PDMP explains the unique characteristics of sensitizing multidrug resistant cells by this drug.