Mammalian cells synthesize significant amounts of precursor sterols, in addition to cholesterol, at the endoplasmic reticulum (ER). The newly synthesized sterols rapidly move to the plasma membrane (PM). The mechanism by which precursor sterols move back to the ER for their enzymatic processing to cholesterol is essentially unknown. Here we performed pulse-chase experiments and showed that the C29/C30 sterols rapidly move from the PM to the ER and are converted to cholesterol. The retrograde precursor sterol transport is largely independent of the Niemann-Pick type C proteins, which play important roles in late endosomal cholesterol transport. In contrast, disrupting lipid rafts significantly retards the conversion of C29/C30 and C28 sterols to cholesterol, causing the accumulation of precursor sterols at the PM. Our results reveal a previously undisclosed function of the PM lipid rafts: they bring cholesterol biosynthesis to completion by participating in the retrograde movement of precursor sterols back to the ER.