The fluorescence properties of dehydroergosterol and cholesta-5,7,9-trien-3 beta-ol have been studied in organic solution, in aqueous dispersions and incorporated into aqueous lipid dispersions. The absorption spectra of aqueous dispersions of the probes are very different to those in organic solution, and aqueous dispersions are non-fluorescent. This can be attributed to micelle formation with dimerisation and/or aggregation in the micelles. Concentration quenching also occurs when sterols are incorporated into lipid bilayers, but relatively high fluorescence is observed even at a 1 : 1 steroid:lipid molar ratio. Further, the fluorescence is still polarized at these high molar ratios. We attribute this to the formation of ordered arrays of sterol molecules in the lipid bilayers. In these arrays the sterol molecules are organised in an end-to-end fashion, and face-to-face overlap of the sterols is prevented by the lipid molecules. Possible structures for 1 : 1 mixtures are presented.