In the final stage of cell division, cytokinesis constricts and then seals the plasma membrane between the two daughter cells. The constriction is powered by a contractile ring of actin filaments, and scission involves rearrangement of the lipid bilayer of the cell membrane. We have shown that the lipid phosphatidylethanolamine (PE), which normally resides in the internal leaflet of the bilayer, is exposed on the external leaflet of the cleavage furrow as a result of enhanced transbilayer movement of the phospholipids during cytokinesis. To investigate the role of PE in cytokinesis, we employed two different approaches: manipulation of cell surface PE by a PE-binding peptide and establishment of a mutant cell line specifically defective in PE biosynthesis. Both approaches provide evidence that surface exposure of PE is essential for disassembly of the contractile ring at the final stage of cytokinesis. Based on these findings, we proposed that the transbilayer redistribution of PE plays a critical role in mediating coordinated movements between the contractile ring and the plasma membrane that are required for the proper progression of cytokinesis.