We have developed a dynamic self-consistent mean-field model, based on molecular-dynamics simulations, to study lipid-cholesterol bilayers. In this model the lipid bilayer is represented as a two-dimensional lattice field in the lipid chain order parameters, while cholesterol molecules are represented by hard rods. The motion of rods in the system is continuous and is not confined to lattice cells. The statistical mechanics of chain ordering is described by a mean field derived from an extension of a model due to Marcelja. The time evolution of the system is governed by stochastic equations. The ensemble of chain configurations required in partition sums, and the energies of interaction, are taken from atomistic level molecular-dynamics simulations of lipid bilayers. The model allows us to simulate systems 500 nm in lateral size for 20 micros time scales, or greater. We have applied the model to dipalmitoyl-phosphatidylcholine-cholesterol (Chol) bilayers at 50 degrees C for Chol concentrations between 2% and 33%. At low concentrations of Chol (2%-4%), the model predicts the formation of isolated clusters of Chol surrounded by relatively ordered lipid chains, randomly dispersed in the disordered bilayer. With increasing Chol composition, regions of Chol-induced order begin to overlap. Starting from about 11% Chol this ordering effect becomes system wide and regions unaffected by Chol are no longer detectable. From the analysis of properties of the model we conclude that the change in lipid chain order with increasing Chol concentration is continuous over the 20-mus scale of the simulations. We also conclude that at 50 degrees C no large-scale Chol-rich and Chol-depleted coexisting phase-separated regions form at any concentration. At no point in any of the simulations do we observe a higher degree of lateral organization, such as Chol-based superlattice structures.