A methyl--cyclodextrin-induced lipid exchange technique was devised to prepare small unilamellar vesicles with stable asymmetric lipid compositions. Asymmetric vesicles that mimic biological membranes were prepared with sphingomyelin (SM) or SM mixed with 1-palmitoyl-2-oleoyl-phosphatidylcholine (POPC) as the predominant lipids in the outer leaflet and dioleoylphosphatidylcholine (DOPC), POPC, 1-palmitoyl-2-oleoyl-phosphatidyl-L-serine (POPS), or POPS mixed with 1-palmitoyl-2-oleoyl-phosphatidylethanolamine (POPE) in the inner leaflet. Fluorescence-based assays were developed to confirm lipid asymmetry. Cholesterol was introduced into these vesicles using a second methyl--cyclodextrin exchange step. In asymmetric vesicles composed of SM outside, DOPC inside (SMo/ DOPCi) or SM outside, 2:1 mol:mol POPE:POPS inside (SMo/ 2:1 POPE:POPSi) the outer leaflet SM formed an ordered state with a thermal stability similar to that in pure SM vesicles and significantly greater than that in symmetric vesicles with the same overall lipid composition. Analogous behavior was observed in vesicles containing cholesterol. This shows that an asymmetric lipid distribution like that in eukaryotic plasma membranes can be conducive to ordered domain (raft) formation. Furthermore asymmetric vesicles containing ϳ25 mol % cholesterol formed ordered domains more thermally stable than those in asymmetric vesicles lacking cholesterol, showing that the crucial ability of cholesterol to stabilize ordered domain formation is likely to contribute to ordered domain formation in cell membranes. Additional studies demonstrated that hydrophobic helix orientation is affected by lipid asymmetry with asymmetry favoring formation of the transmembrane configuration. The ability to form asymmetric vesicles represents an important improvement in model membrane studies and should find many applications in the future.Over the last few decades artificial lipid bilayers of various types have been successfully used as models for biological membranes, yielding many important insights into the architecture of cell membranes. Vesicle dispersions (liposomes) have perhaps been the most useful model membrane system. However, commonly used preparation procedures do not provide control over differences in lipid composition between inner and outer leaflets (lipid asymmetry). This is a troubling limitation because biological membranes are highly asymmetric. In mammalian cells the plasma membrane outer leaflet (exofacial monolayer) is enriched in sphingolipids and phosphatidylcholine (PC), 2 whereas the inner leaflet (cytofacial monolayer) is enriched in phosphatidylethanolamine (PE) and phosphatidylserine (PS) (1).The subject of lipid asymmetry has become all the more important because of its potential role in the structure and function of lipid rafts. Lipid rafts are defined as sphingolipid and sterol-rich lipid domains that exist in the liquid-ordered (Lo) state. Rafts are thought to co-exist in many eukaryotic cell membranes with liquid-disordered (Ld) state domains ...