The function of the integral membrane protein stomatin is as yet poorly understood. Stomatin is deficient from the erythrocyte membrane of patients suffering with Overhydrated Hereditary Stomatocytosis (OHSt). Patient erythrocytes have altered morphology and are known as stomatocytes. It is believed that stomatin is mistrafficked in the developing stomatocyte. These patients suffer grossly abnormal cation fluxes in the stomatocyte membrane which causes increased osmotic fragility of the cell and results in haemolytic anaemia. This study set out to characterise further stomatin and to investigate its role in the cell. The membranes and lipid rafts of stomatocytes were found to have reduced actin levels as compared to erythrocytes, suggesting that stomatin may function as a structural protein linking the cytoskeleton to the membrane. Overexpression of stomatin in nucleated cells caused enhanced actin association with cell membranes and lipid rafts, further confirming the findings from stomatocytes. Calcium-induced vesiculation was found to be significantly enhanced from the stomatocyte as compared to the erythrocyte, with defective partitioning of the flotillin proteins into the vesicles. This suggests that stomatin may function as a negative regulator in this vesiculation, possibly due to its interaction with actin and that the flotillins may substitute for stomatin in this process within the stomatocyte. Mutating the principle cysteine residue for palmitoylation within stomatin caused the protein to show less affinity for the membrane and lipid rafts but an increased affinity for the nucleus. This suggests that palmitoylation of stomatin affects the affinity of stomatin for the membrane and that this modification may be involved in regulating the shuttling of stomatin between the plasma membrane and the nucleus. Prokaryotic stomatin exists in an operon with a serine protease, suggesting a functional link between the two. Using a reporter gene construct approach the potential for mammalian stomatin to be proteolytically processed was investigated. Stomatin was found to be proteolytically processed in the membrane by a serine protease with the subsequent release of a C-terminal fragment.