Survival of Salmonella typhimurium within a vacuole in host cells depends on secreted virulence factors encoded by the Salmonella pathogenicity island 2 (SPI-2). High levels of cholesterol are detected at the Salmonella-containing vacuole (SCV). Here we show that the SPI-2 effector SseJ esterifies cholesterol in vitro, in cells and during infection. Intracellular infections with wild-type as compared with DeltasseJ bacteria led to higher levels of cholesterol ester production in HeLa cells and RAW macrophages and were shown to increase levels of lipid droplets (structures enriched in cholesterol esters). Ectopic expression of SseJ reduced cholesterol levels in cellular membranes and antagonized a major membrane activity of a second bacterial effector known to be important to the stability of the SCV. Previous studies in mouse models of infection have established a virulence defect in DeltasseJ bacteria and have suggested a role for SseJ in regulating SCV dynamics. Our data indicating the molecular activity of SseJ suggest that cholesterol and its esterification at the SCV are functionally important for intracellular bacterial survival.