Lipid bilayers exhibit a phase behavior that involves two distinct, but cou
pled, order-disorder processes, one in terms of lipid-chain crystalline pac
king (translational degrees of freedom) and the other in terms of lipid-cha
in conformational ordering (internal degrees of freedom). Experiments and p
revious approximate theories have suggested that cholesterol incorporated i
nto lipid bilayers has different microscopic effects on lipid-chain packing
and conformations and that cholesterol thereby leads to decoupling of the
two ordering processes, manifested by a special equilibrium phase, "liquid-
ordered phase," where bilayers are liquid (with translational disorder) but
lipid chains are conformationally ordered. We present in this paper a micr
oscopic model that describes this decoupling phenomena and which yields a p
hase diagram consistent with experimental observations. The model is an off
-lattice model based on a two-dimensional random triangulation algorithm an
d represents lipid and cholesterol molecules by hard-core particles with in
ternal (spin-type) degrees of freedom that have nearest-neighbor interactio
ns. The phase equilibria described by the model, specifically in terms of p
hase diagrams and structure factors characterizing different phases, are ca
lculated by using several Monte Carlo simulation techniques, including hist
ogram and thermodynamic reweighting techniques, finite-size scaling as well
as non-Boltzmann sampling techniques (in order to overcome severe hysteres
is effects associated with strongly first-order phase transitions). The res
ults provide a consistent interpretation of the various phases of phospholi
pid-cholesterol binary mixtures based on the microscopic dual action of cho
lesterol on the lipid-chain degrees of freedom. In particular, a distinct s
mall-scale structure of the liquid-ordered phase has been identified and ch
aracterized. The generic nature of the model proposed holds a promise for a
unifying description for a whole series of different lipid-sterol mixtures
. [S1063-651X(99)09305-8].