Pore formation by the cholesterol-dependent cytolysins (CDCs) requires the presence of cholesterol in the target membrane. Cholesterol was long thought to be the cellular receptor for these toxins, but not all CDCs require cholesterol for binding. Intermedilysin, secreted by Streptococcus intermedius, only binds to membranes containing the human protein CD59 but forms pores only if the membrane contains sufficient cholesterol. In contrast, perfringolysin O (PFO), secreted by Clostridium perfringens, only binds to membranes containing substantial amounts of cholesterol. Given that different steps in the assembly of various CDC pores require cholesterol, here we have analyzed to what extent cholesterol molecules, by themselves, can modulate the conformational changes associated with PFO oligomerization and pore formation. PFO binds to cholesterol when dispersed in aqueous solution, and this binding triggers the distant rearrangement of a beta-strand that exposes an oligomerization interface. Moreover, upon binding to cholesterol, PFO forms a prepore complex, unfolds two amphipathic transmembrane beta-hairpins, and positions their nonpolar surfaces so they associate with the hydrophobic cholesterol surface. The interaction of PFO with cholesterol is therefore sufficient to initiate an irreversible sequence of coupled conformational changes that extend throughout the toxin molecule.