Hydrotropes are amphiphilic molecules that are too small to spontaneously form equilibrium structures in aqueous solutions, but form dynamic, non-covalent assemblies, referred to as clusters. In the presence of a hydrophobic compound, these clusters seem to get stabilized leading to the formation of long-lived, highly stable mesoscopic droplets, a phenomenon that we call “mesoscale solubilization”. In this work, we focus on the unusual mesoscopic properties of aqueous solutions of a nonionic hydrotrope, namely tertiary butyl alcohol (TBA), on addition of various hydrophobic compounds. Aqueous TBA solutions, in about 3–8mol% TBA concentration range and about 0–25°C temperature range, show the presence of short-ranged (∼0.5nm), short-lived (tens of picoseconds) molecular clusters which result in anomalies of the thermodynamic properties. These clusters are transient but do not relax by diffusion, thus distinctly different from conventional concentration fluctuations. In this concentration and temperature range, upon the addition of a third (more hydrophobic) component to TBA–water solutions, long-lived mesoscopic droplets of about 100nm size are observed. In this work, we clarify the ambiguity behind the definition of solubility and elucidate the phenomenon of mesoscale solubilization. A systematic study of the macroscopic and mesoscopic phase behavior of three ternary systems TBA–water-propylene oxide, TBA–water-isobutyl alcohol, and TBA–water-cyclohexane has been carried out. We differentiate between molecular solubility, mesoscale solubilization, and macroscopic phase separation. We have confirmed that practically stable aqueous colloids can be created from small molecules, without addition of surfactants or polymers. Such kind of novel materials may find applications in the design of various processes and products, ranging from pharmaceuticals to cosmetics and agrochemicals.