The esterification of cholesterol by the plasma phosphatidyl choline‐cholesterol acyltransferase reaction was studied by two methods, radioisotopic and colorimetric, in the presence of cerebroside, ceramide, or methyl esters of lignoceric or α‐hydroxy lignoceric acid. The radioisotopic method measures esterification of exogenous labeled cholesterol which must be taken up into the lipoprotein‐bound pool prior to its utilization as a substrate. The colorimetric method measures esterification of endogenous lipoprotein‐bound free cholesterol since the exogenous labeled cholesterol is negligible in concentration. Cerebroside and ceramide containing α‐hydroxy fatty acids reduced the utilization of exogenous labeled cholesterol as substrate, but had no effect on lipoprotein‐bound exogenous cholesterol esterification. Cerebroside and ceramide containing no α‐hydroxy fatty acid had no effect on exogenous labeled cholesterol esterification. The methyl esters of lignoceric acid and α‐hydroxy lignoceric acid had no effect on the esterification of exogenous cholesterol in plasma. There is a decrease in esterification of exogenous labeled cholesterol with increasing concentration of α‐hydroxy fatty acid ceramide. Increasing the concentration of exogenous cholesterol tends to counteract the effect of the ceramide on cholesterol esterification. There was little effect on exogenous cholesterol esterification when the α‐hydroxy fatty acid ceramide was exposed to plasma before adding the labeled cholesterol. The findings demonstrate an interaction between free cholesterol and cerebroside or ceramide containing α‐hydroxy fatty acids, but the nature of the interaction is not elucidated.