Nucleation of cholesterol monohydrate crystals from bile is a critical step in the formation of cholesterol gallstones. Measurement of nucleation in model bile systems and the characteristics of the initial nucleus have proven elusive. In this study we have used three separate physical chemical techniques to examine vesicle aggregation and fusion, including dynamic light scattering (DLS), transmission electron microscopy (TEM), and fluorescent biochemical assays. These assays enabled us to quantify the effect of biliary proteins, such as gallbladder mucin, on vesicle fusion and aggregation. In the absence of mucin, fusion is a relatively slow process occurring over 24 hours, whereas physiological concentrations of mucin are able to accelerate almost complete fusion of vesicles within 6 hours. Vesicle fusion and aggregation as characterized by TEM result in the formation of aggregates of multilamellar vesicles and giant fusion bodies associated with a background of mucin. These mucin-vesicle aggregate bodies may represent true nuclei and precede cholesterol monohydrate crystal nucleation. In future studies, these vesicle fusion assays can be used to quantitatively examine the effect of putative pro- and anti-nucleating proteins on the earliest steps of cholesterol crystal nucleation. (Hepatology 1995; 22:856–865.)