Cholesterol is an essential component of higher eukaryotic membranes and plays a crucial role in membrane organization, dynamics and function. The G-protein coupled receptors (GPCRs) are the largest class of molecules involved in signal transduction across membranes, and represent major targets in the development of novel drug candidates in all clinical areas. Membrane cholesterol has been reported to have a modulatory role in the function of a number of GPCRs. Two possible mechanisms have been previously suggested by which membrane cholesterol could influence the structure and function of GPCRs (i) through a direct/specific interaction with GPCRs, or (ii) through an indirect way by altering membrane physical properties in which the receptor is embedded, or due to a combination of both. Recently reported crystal structures of GPCRs have shown structural evidence of cholesterol binding sites. Against this backdrop, we recently proposed a novel mechanism by which membrane cholesterol could affect structure and function of GPCRs. According to our hypothesis, cholesterol binding sites in GPCRs could represent 'nonannular' binding sites. Interestingly, previous work from our laboratory has demonstrated that membrane cholesterol is required for the function of the serotonin(1A) receptor (a representative GPCR), which could be due to specific interaction of the receptor with cholesterol. Based on these results, we envisage that there could be specific/nonannular cholesterol binding site(s) in the serotonin(1A) receptor. We have analyzed putative cholesterol binding sites from protein databases in the serotonin(1A) receptor. Our analysis shows that cholesterol binding sites are inherent characteristic features of serotonin(1A) receptors and are conserved through natural evolution. Progress in deciphering molecular details of the GPCR-cholesterol interaction in the membrane would lead to better insight into our overall understanding of GPCR function in health and disease, thereby enhancing our ability to design better therapeutic strategies to combat diseases related to malfunctioning of GPCRs.