Cholesterol was incorporated into DMPC to better mimic the biological membrane. It was elucidated that formation of the stable DMPC subgel phase is a complex process that demonstrates the metastability of the planar gel phase. Results showed incubation of DMPC at 268K or colder for at least 2 hours induced the formation of the subgel. Furthermore, the subgel phase can be observed at high concentrations of ethanol (15 v/v%) and low concentrations of cholesterol (5 mol%. The interdigitated phase does not occur with pure DMPC, but may occur with the induction of a small molecule such as ethanol. The threshold range for the onset of interdigitation of DMPC with 10 mol% cholesterol was found to be 14-16% ethanol. This threshold range is similar to the threshold range of the DMPC system without cholesterol. As cholesterol concentration increased, the main transition peaks were broadened and the enthalpy decreased. Cholesterol was found to increase the fluidity of DMPC below the main transition and decrease the fluidity above the main transition.