The red seaweed Laurencia dendroidea belongs to the Rhodophyta, a phylum of eukaryotic algae that is widely distributed across the oceans and that constitute an important source of bioactive specialized metabolites. Laurencia species have been studied since 1950 and were found to contain a plethora of specialized metabolites, mainly halogenated sesquiterpenes, diterpenes and triterpenes that possess a broad spectrum of pharmacological and ecological activities. The first committed step in the biosynthesis of triterpenes is the cyclization of 2,3-oxidosqualene, an enzymatic reaction carried out by oxidosqualene cyclases (OSCs), giving rise to a broad range of different compounds, such as the sterol precursors cycloartenol and lanosterol, or triterpene precursors such as cucurbitadienol and β-amyrin. Here, we cloned and characterized the first OSC from a red seaweed. The OSC gene was identified through mining of a L. dendroidea transcriptome dataset and subsequently cloned and heterologously expressed in yeast for functional characterization, which indicated that the corresponding enzyme cyclizes 2,3-oxidosqualene to the sterol precursor cycloartenol. Accordingly, the gene was named L. dendroidea cycloartenol synthase (LdCAS). A phylogenetic analysis using OSCs genes from plants, fungi and algae revealed that LdCAS grouped together with OSCs from other red algae, suggesting that cycloartenol could be the common product of the OSC in red seaweeds. Furthermore, profiling of L. dendroidea revealed cholesterol as the major sterol accumulating in this species, implicating red seaweeds contain a ‘hybrid’ sterol synthesis pathway in which the phytosterol precursor cycloartenol is converted into the major animal sterol cholesterol.