Cholesterol is most often found distributed nonrandomly in the plane of the bilayer, giving rise to cholesterol-rich and -poor domains. Many of these domains are thought to be crucial for the maintenance of membrane structure and function. However, such well-characterized domains generally occur in the membranes that contain relatively large amounts of cholesterol. Cholesterol organization in membranes containing very low amounts of cholesterol has not been investigated extensively. Recent evidence from differential-scanning calorimetric studies suggests that cholesterol may not form uniform monodisperse solutions, as assumed earlier, in the membranes even at very low concentrations. Fluorescent cholesterol analogues, when chosen carefully, offer a powerful approach for studying the distribution and organization of cholesterol in membranes at low concentrations. In this paper, we have studied the organization of cholesterol in membranes at very low concentrations (up to 5 mol % of the total lipid) using a fluorescent cholesterol analogue (NBD-cholesterol) which is labeled with the 7-nitrobenz-2-oxa-1,3-diazol-4-yl (NBD) group at the flexible acyl chain, without any alteration in the structural features necessary for proper membrane incorporation. Our results show that NBD-cholesterol exhibits local organization even at very low concentrations. This is consistent with the recently suggested model of cholesterol organization in membranes at low concentrations, involving the formation of transbilayer, tail-to-tail dimers The fluid mosaic model for biological membranes defines the membrane as an oriented, two-dimensional, viscous solution of proteins and lipids in instantaneous thermodynamic equilibrium (Singer & Nicolson, 1972). Although the basic tenets of this model have stood the test of time, one of its implicit assumptions, that the lipid molecules merely provide the milieu for the membrane proteins and that they are distributed uniformly throughout the bilayer, has been found to be not quite true. In fact, current evidence points out that both transverse and lateral regionalization, which can be described in terms of micro-and macrodomains, are common features of many biological membranes (Curtain et al., 1988;Edidin, 1992;Tocanne, 1992;Glaser, 1993;Jacobson et al., 1995).Cholesterol is one of the membrane components that is found, more often than not, distributed nonrandomly in structural and kinetic domains or pools in both biological and model membranes (Yeagle, 1985;Gennis, 1989;Schroeder et al., 1991;Liscum & Underwood, 1995). The reason for this lies in the rather unusual chemical structure of cholesterol that can by no means be considered a representative component of the "bulk" membrane (see Figure 1). The unusual shape of cholesterol also causes a phase separation in membranes at relatively high concentrations, resulting in the formation of cholesterol-rich and -poor domains that are structurally and compositionally so distinct that they can be observed histochemically and isolated physical...