Cholesterol (Chol) is often regarded an essential nutrient for decapod crustaceans owing to low to no capacity for de novo synthesis. Dietary requirements for cholesterol in crustaceans have been shown to depend on multiple criteria such as species, life-stage, natural diet, feeding behaviours, and nutrient interactions. This study was conducted to test the hypothesis that dietary Chol is essential for early juvenile slipper lobster, Thenus australiensis, and further to explore the potential for interactions between dietary Chol and phospholipid (PhosL). An 8-week experiment was conducted using six experimental feeds in a 3 x 2 factorial design using three supplemental Chol levels of 0, 0.2 and 0.4% dry matter (DM) at two different supplemental PhosL concentrations of 0% and 1.0% DM. Results showed that dietary Chol concentrations of 0.2 and 0.4% DM resulted in 2 to 3-fold greater growth responses and overall higher nutritional condition compared to 0% DM dietary Chol. With no inclusion of dietary PhosL, survival was significantly lower (46%) at 0% DM dietary Chol compared to 0.2 and 0.4% DM dietary Chol (96-100%), while survival of SL was similar for all dietary Chol concentrations at 1% DM dietary PhosL (71-92%). Survival was improved by supplementing the 0% Chol feed with 1.0% PhosL. However, all surviving lobsters at 0% DM dietary Chol, regardless of dietary PhosL level, were in poor nutritional condition upon conclusion of the experiment as judged by the lower hepatosomatic index. Apparent feed intake (AFI) was significantly higher at dietary Chol ≥ 0.2% DM but was slightly lower for each corresponding dietary Chol level at 1% DM dietary PhosL. Similar growth rates with lower AFI resulted in improved feed conversion ratios (FCR) at 1% DM dietary PhosL. This study confirms that dietary Chol is essential for early juvenile T. australiensis, while the provision of 1% DM dietary PhosL provided minor additional benefit compared to dietary Chol alone. The supplemental dietary Chol requirement for early juvenile T. australiensis appears to be relatively low at 0.2% DM in a semi-purified feed, and higher levels may not provide additional growth enhancing benefits.