Sterols inhibit their own synthesis in mammalian cells by blocking the vesicular endoplasmic reticulum-to-Golgi transport of sterol regulatory element-binding protein (SREBP) cleavage-activating protein (SCAP), a sterol-sensing protein that escorts SREBPs. Unable to reach the Golgi, SREBPs are not processed by Golgi-resident proteases, and they fail to activate genes required for cholesterol synthesis. The current studies were designed to reveal whether sterols block SCAP movement by inhibiting synthesis of special vesicles dedicated to SCAP, or whether sterols block SCAP incorporation into common coat protein (COP)II-coated vesicles. Through immunoisolation, we show that SCAP-containing vesicles, formed in vitro, also contain vesicular stomatitis virus glycoprotein (VSVG) protein, a classic marker of COPII-coated vesicles. Sterols selectively block incorporation of SCAP into these vesicles without blocking incorporation of VSVG protein. We show that the mammalian vesicular budding reaction can be reconstituted by recombinant yeast COPII proteins that support incorporation of SCAP as well as VSVG into vesicles. Sterols block SCAP incorporation into vesicles by blocking Sar1-dependent binding of the COPII proteins Sec 23/24 to SCAP. These studies demonstrate feedback control of a biosynthetic pathway by the regulated binding of COPII proteins to an endoplasmic reticulum-to-Golgi transport protein.