The role of endocytosis in nutrient uptake by Toxoplasma gondii is unknown. To explore this issue, we characterized an endosomal compartment by identifying a T. gondii Rab5 homologue, a molecular marker for early endosomes in eukaryotic cells. The deduced amino acid sequence of the T. gondii Rab5 gene encodes a protein of 240 amino acids, which we termed TgRab51. TgRab51 was epitope-tagged at the N-terminus, expressed in the parasite, and localized by immunofluorescence and immunoelectron microscopy to tubulovesicular structures anterior to the parasite nucleus and adjacent to, but distinct from the Golgi. By immunofluorescence analysis, TgRab51wt-HA staining partially overlapped with Golgi/TGN markers, but not with the T. gondii secretory organelles. A dominant positive mutant, TgRab51Q103L-HA, enhanced uptake of exogenous cholesterol analogues in intracellular parasites, augmented formation of lipid droplets and accelerated parasite growth. Brefeldin A disrupted the TgRab51 compartment, and altered the distribution of fluorescent exogenous cholesterol in cells expressing TgRab51Q103L-HA. These results suggest that TgRab51 facilitates sterol uptake, possibly through a Golgi-dependent pathway.