BACKGROUND AND PURPOSE: Lipid rafts and caveolae are membrane microdomains with important roles in cell survival signalling involving the Akt pathway. Cholesterol is important for the structure and function of these microdomains. The ginsenoside Rh2 exhibits anti-tumour activity. Because Rh2 is structurally similar to cholesterol, we investigated the possibility that Rh2 exerted its anti-tumour effect by modulating rafts and caveolae. EXPERIMENTAL APPROACH: A431 cells (human epidermoid carcinoma cell line) were treated with Rh2 and the effects on cell apoptosis, raft localization and Akt activation measured. We also examined the effects of over-expression of Akt and active-Akt on Rh2-induced cell death. KEY RESULTS: Rh2 induced apoptosis concentration- and time-dependently. Rh2 reduced the levels of rafts and caveolae in the plasma membrane and increased their internalization. Furthermore, Akt activity was decreased and consequently, Akt-dependent phosphorylation of Bad, a pro-survival protein, was decreased whereas the pro-apoptotic proteins, Bim and Bax, were increased upon Rh2 treatment. Unlike microdomain internalization induce by cholesterol depletion, Rh2-mediated internalization of rafts and caveolae was not reversed by cholesterol addition. Also, cholesterol addition did not restore Akt activation or rescue cells from Rh2-induced cell death. Rh2-induced cell death was attenuated in MDA-MB-231 cells over-expressing either wild-type or dominant-active Akt. CONCLUSIONS AND IMPLICATIONS: Rh2 induced internalization of rafts and caveolae, leading to Akt inactivation, and ultimately apoptosis. Because elevated levels of membrane rafts and caveolae, and Akt activation have been correlated with cancer development, internalization of these microdomains by Rh2 could potentially be used as an anti-cancer therapy.