In previous studies using heterologous expression systems, e.g., Xenopus oocytes, HEK-293 cells, or neurons, the contribution of endogenous proteins could not be entirely eliminated or controlled29, 30. For example, cholesterol concentration in plasma membranes is affected by numerous factors and varies between expression systems31. To elucidate more definitively the mechanisms of GIRK activation, a different approach is needed in which the lipid components, G proteins and activators can be all controlled experimentally. In the current study, we implemented a methodology in which we purified GIRK2 channels, reconstituted the channels into liposomes with different lipid compositions and then probed channel function with exogenous ligands. We demonstrate that alcohol and cholesterol directly activate neuronal GIRK2 channels, in the absence of G protein Gβγ subunits but requiring PIP2. Interestingly, although PIP2 has been considered a co-factor that is necessary, but not sufficient, for channel activation, here we demonstrate that PIP2 is sufficient to activate GIRK2 channels in the presence of Na+. Further, we discovered that alcohol and cholesterol appear to interact structurally with different regions of the channel. Determining the mechanism of activation