In plants, sterols play fundamental roles as membrane constituents in the biosynthesis of steroid hormones, and act as precursors for cell wall deposition. Sterols are synthesized in the endoplasmic reticulum (ER), but mainly accumulate in the plasma membrane. How sterols are trafficked in plant cells is largely unknown. In non-plant systems, oxysterol-binding proteins have been involved in sterol trafficking and homeostasis. There are at least twelve homologs of oxysterol-binding proteins in the Arabidopsis genome, but the biology of these proteins remains for the most part obscure. Here, we report our analysis of the targeting requirements and the sterol-binding properties of a small Arabidopsis oxysterol-binding protein, ORP3a. We have determined that ORP3a is a bona fide sterol-binding protein with sitosterol-binding properties. Live-cell imaging analyses revealed that ORP3a is localized at the ER, and that binding to this organelle depends on a direct interaction with PVA12, a member of the largely uncharacterized VAP33 family of plant proteins. Molecular modeling analyses and site-directed mutagenesis led to the identification of a novel protein domain that is responsible for the PVA12-ORP3a interaction. Disruption of the integrity of this domain caused redistribution of ORP3a to the Golgi apparatus, suggesting that ORP3a may cycle between the ER and the Golgi. These results represent new insights into the biology of sterol-binding proteins in plant cells, and elucidate a hitherto unknown relationship between members of oxysterol-binding protein and VAP33 families of plant proteins in the early plant secretory pathway.