Cholesterol, an essential molecule for cell structure, function, and viability, plays crucial roles in the development, progression, and survival of cancer cells. Earlier studies have shown that cholesterol-lowering drugs can inhibit the high expression of programmed-death ligand 1 (PD-L1) that contributes to immunoevasion in cancer cells. However, the regulatory mechanism of cell surface PD-L1 abundance by cholesterol is still controversial. Here, using nuclear magnetic resonance and biochemical techniques, we demonstrated that cholesterol can directly bind to the transmembrane domain of PD-L1 through two cholesterol-recognition amino acid consensus (CRAC) motifs, forming a sandwich-like architecture and stabilizing PD-L1 to prevent downstream degradation. Mutations at key binding residues prohibit PD-L1-cholesterol interactions, decreasing the cellular abundance of PD-L1. Our results reveal a unique regulatory mechanism that controls the stability of PD-L1 in cancer cells, providing an alternative method to overcome PD-L1-mediated immunoevasion in cancers.