Lipid rafts are specialized plasma membrane microdomains, in which glycosphingolipids and cholesterol are major structural components. In T lymphocytes, several signaling proteins are associated with lipid rafts including the protein tyrosine kinase LCK and the adapter protein LAT. To investigate their importance in T cell signaling, lipid rafts were disrupted by depleting cholesterol with methyl‐β‐cyclodextrin (MβCD). This transiently induced tyrosine phosphorylation of multiple proteins, including the ZAP‐70 tyrosine kinase, its associated T cell antigen receptor ζ chain, LAT and phospholipase Cγ1. Tyrosine phosphorylation was dependent on expression of LCK in lipid rafts. Depletion of cholesterol also resulted in activation of the Ras‐ERK pathway. This was largely dependent on phorbol ester‐sensitive protein kinase C (PKC) and the PKC‐θ isoform translocated to the plasma membrane following MβCD treatment. MβCD did not stimulate intracellular Ca²⁺ fluxes; however, consistent with its ability to stimulate Ras, MβCD synergized with a Ca²⁺ ionophore to induce formation of the transcription factor NF‐AT. These data indicate a crucial role for cholesterol in the regulation of signaling pathways in T cells, which is likely to reflect its importance in the formation of plasma membrane lipid rafts.