The oxysterol binding proteins (OSBPs) are believed to control cholesterol homeostasis but their precise mechanism of action is not well understood. The Dictyostelium osbA gene encodes a predicted OSBP, OSBPa, which lacks the PH domain that in most other OSBPs directs targetting to the Golgi. OSBPa instead localises selectively to the cell periphery and also, in some cells, to the perinuclear region. OSBPa null strains form normal fruiting bodies but are defective in the regulation of the transition from slug migration to culmination. Thus a plasma membrane-enriched OSBP family member is essential for correct regulation of the slug-fruiting body switch.