Cholesterol is an essential structural component of animal cell membranes. It is required to maintain membrane structural integrity and fluidity. Cholesterol also serves as a precursor for the biosynthesis of several hormones, bile acid and vitamin D. Plasma membrane contains majority of the cellular cholesterol (80-90%) whereas little cholesterol resides in endoplasmic reticulum and in mitochondrial membrane. Transport of intracellular cholesterol within the cells to different compartments is through vesicular and non-vesicular pathways. Defects in these transport processes can alter cellular cholesterol metabolism resulting in pathological conditions. Filipin III is widely used as a probe for sterol localization in membranes. Interaction with cholesterol alters Filipin absorption and fluorescence spectra. This assay provides a simple, easy to perform, histochemical method of identification of unesterified cholesterol.