To address the role of phospholipids in the topological organization of polytopic membrane proteins, the function and assembly of lactose permease (LacY) was studied in mutants of Escherichia coli lacking phosphatidylethanolamine (PE). PE is required for the proper conformation and active transport function of LacY. The N-terminal half of LacY assembled in PE-lacking cells adopts an inverted topology in which normally non-translocated domains are translocated and vice versa. Post-assembly synthesis of PE triggers a conformational change, resulting in a lipid-dependent recovery of normal conformation and topology of at least one LacY subdomain accompanied by restoration of active transport. These results demonstrate that membrane protein topology once attained can be changed in a reversible manner in response to alterations in phospholipid composition, and may be subject to post-assembly proofreading to correct misfolded structures.