Differential scanning calorimetry and x-ray diffraction have been utilized to investigate the interaction of N-stearoylsphingomyelin (C18:0-SM) with cholesterol and dipalmitoylphosphatidylcholine (DPPC). Fully hydrated C18:0-SM forms bilayers that undergo a chain-melting (gel -->liquid-crystalline) transition at 45 degrees C, delta H = 6.7 kcal/mol. Addition of cholesterol results in a progressive decrease in the enthalpy of the transition at 45 degrees C and the appearance of a broad transition centered at 46.3 degrees C; this latter transition progressively broadens and is not detectable at cholesterol contents of >40 mol%. X-ray diffraction and electron density profiles indicate that bilayers of C18:0-SM/cholesterol (50 mol%) are essentially identical at 22 degrees C and 58 degrees C in terms of bilayer periodicity (d = 63-64 A), bilayer thickness (d rho-p = 46-47 A), and lateral molecular packing (wide-angle reflection, 1/4.8 A-(1)). These data show that cholesterol inserts into C18:0-SM bilayers, progressively removing the chain-melting transition and altering the bilayer structural characteristics. In contrast, DPPC has relatively minor effects on the structure and thermotropic properties of C18:0-SM. DPPC and C18:0-SM exhibit complete miscibility in both the gel and liquid-crystalline bilayer phases, but the pre-transition exhibited by DPPC is eliminated at >30 mol% C18:0-SM. The bilayer periodicity in both the gel and liquid-crystalline phases decreases significantly at high DPPC contents, probably reflecting differences in hydration and/or chain tilt (gel phase) of C18:0-SM and DPPC.