Cholesterol is abundant in the plasma membranes of animal cells and is known to regulate a variety of membrane properties. Despite decades of research, the transmembrane distribution of cholesterol is still a matter of debate. Here we consider this outstanding issue through atomistic simulations of asymmetric lipid membranes, whose composition is largely consistent with eukaryotic plasma membranes. We show that the membrane dipole potential changes in a cholesterol-dependent manner. Remarkably, moving cholesterol from the extracellular to the cytosolic leaflet increases the dipole potential on the cytosolic side, and vice versa. Biologically this implies that by altering the dipole potential, cholesterol can provide a driving force for cholesterol molecules to favor the cytosolic leaflet, in order to compensate for the intramembrane field that arises from the resting potential.