Stabilization and maturation of synapses are important for development and function of the nervous system. Previous studies have implicated cholesterol-rich lipid microdomains in synapse stabilization, but the underlying mechanisms remain unclear. We found that cholesterol stabilizes clusters of synaptic acetylcholine receptors (AChRs) in denervated muscle in vivo and in nerve-muscle explants. In paralyzed muscles, cholesterol triggered maturation of nerve sprout-induced AChR clusters into pretzel shape. Cholesterol treatment also rescued a specific defect in AChR cluster stability in cultured src(-/-);fyn(-/-) myotubes. Postsynaptic proteins including AChRs, rapsyn, MuSK and Src-family kinases were strongly enriched in lipid microdomains prepared from wild-type myotubes. Microdomain disruption by cholesterol-sequestering methyl-beta-cyclodextrin disassembled AChR clusters and decreased AChR-rapsyn interaction and AChR phosphorylation. Amounts of microdomains and enrichment of postsynaptic proteins into microdomains were decreased in src(-/-);fyn(-/-) myotubes but rescued by cholesterol treatment. These data provide evidence that cholesterol-rich lipid microdomains and SFKs act in a dual mechanism in stabilizing the postsynapse: SFKs enhance microdomain-association of postsynaptic components, whereas microdomains provide the environment for SFKs to maintain interactions and phosphorylation of these components.