Membrane microdomains are assembled by lipid partitioning (e.g., rafts) or by protein-protein interactions (e.g., coated vesicles). During docking, yeast vacuoles assemble "vertex" ring-shaped microdomains around the periphery of their apposed membranes. Vertices are selectively enriched in the Rab GTPase Ypt7p, the homotypic fusion and vacuole protein sorting complex (HOPS)-VpsC Rab effector complex, SNAREs, and actin. Membrane fusion initiates at vertex microdomains. We now find that the "regulatory lipids" ergosterol, diacylglycerol and 3- and 4-phosphoinositides accumulate at vertices in a mutually interdependent manner. Regulatory lipids are also required for the vertex enrichment of SNAREs, Ypt7p, and HOPS. Conversely, SNAREs and actin regulate phosphatidylinositol 3-phosphate vertex enrichment. Though the PX domain of the SNARE Vam7p has direct affinity for only 3-phosphoinositides, all the regulatory lipids which are needed for vertex assembly affect Vam7p association with vacuoles. Thus, the assembly of the vacuole vertex ring microdomain arises from interdependent lipid and protein partitioning and binding rather than either lipid partitioning or protein interactions alone.