In the adult brain, neurons require local cholesterol production, which is supplied by astrocytes through apoE-containing lipoproteins. In Huntington's disease (HD), such cholesterol biosynthesis in the brain is severely reduced. Here we show that this defect, occurring in astrocytes, is detrimental for HD neurons. Astrocytes bearing the huntingtin protein containing increasing CAG repeats secreted less apoE-lipoprotein-bound cholesterol in the medium. Conditioned media from HD astrocytes and lipoprotein-depleted conditioned media from wild-type (wt) astrocytes were equally detrimental in a neurite outgrowth assay and did not support synaptic activity in HD neurons, compared with conditions of cholesterol supplementation or conditioned media from wt astrocytes. Molecular perturbation of cholesterol biosynthesis and efflux in astrocytes caused similarly altered astrocyte-neuron cross talk, whereas enhancement of glial SREBP2 and ABCA1 function reversed the aspects of neuronal dysfunction in HD. These findings indicate that astrocyte-mediated cholesterol homeostasis could be a potential therapeutic target to ameliorate neuronal dysfunction in HD.