The cellular membrane of eukaryotes consists of phospholipids, sphingolipids, cholesterol and membrane proteins. Among them, cholesterol is crucial for various cellular events (e.g., signaling, viral/bacterial infection, and membrane trafficking) in addition to its essential role as an ingredient of steroid hormones, vitamin D, and bile acids. From a micro-perspective, at the plasma membrane, recent emerging evidence strongly suggests the existence of lipid nanodomains formed with cholesterol and phospholipids (e.g., sphingomyelin, phosphatidylserine). Thus, it is important to elucidate how cholesterol behaves in membranes and how the behavior of cholesterol is regulated at the molecular level. To elucidate the complexed characteristics of cholesterol in cellular membranes, a couple of useful biosensors that enable us to visualize cholesterol in cellular membranes have been recently developed by utilizing domain 4 (D4) of Perfringolysin O (PFO, theta toxin), a cholesterol-binding toxin. This review highlights the current progress on development of novel cholesterol biosensors that uncover new insights of cholesterol in cellular membranes.