We propose here a new and detailed model for the antimalarial action of chloroquine (CQ), based on the its ability to inhibit degradation of heme by glutathione. Heme, which is toxic to the malaria parasite, is formed when the intraerythrocytic malaria parasite ingests and digests inside its food vacuole its host cell cytosol, which consists mainly of hemoglobin. The parasite protects itself against the toxicity of heme by polymerizing some of it to insoluble hemozoin (HZ). We show here that in Plasmodium falciparum at the trophozoite stage only ca. 30% of the heme is converted into hemozoin. We suggest that nonpolymerized heme exits the food vacuole and is subsequently degraded by glutathione, as has been shown before for uninfected erythrocytes. Marginal amounts of free heme could be detected in the membrane fraction of infected cells but nowhere else. It is well established that CQ and amodiaquine (AQ) accumulate in the parasite's food vacuole and inhibit heme polymerization, thereby increasing its efflux out of the food vacuole. We found that these drugs competitively inhibit the degradation of heme by glutathione, thus allowing heme to accumulate in membranes. Incubation of intact infected cells with CQ and AQ results in a marked increase in membrane-associated heme in a dose- and time-dependent manner, and a relationship exists between membrane heme levels and the extent of parasite killing. Heme has been shown to disrupt the barrier properties of membranes and to upset ion homeostasis in CQ-treated malaria-infected cells. In agreement with the predictions of our model, increasing the cellular levels of glutathione leads to increased resistance to CQ, whereas decreasing them results in enhanced sensitivity to the drug. These results insinuate a novel mechanism of drug resistance.