We demonstrate Förster resonance energy transfer from dehydroergosterol to dansylated lecithin in lecithin-cholesterol vesicles and characterize the vesicles in the presence of the pro-nucleating enzyme, phospholipase C (PLC). Exposure to phospholipase C causes a temporary decrease in the dehydroergosterol to dansyl fluorescence ratio followed by an increase to and above the initial value. The temporary decrease in the fluorescence ratio results from an increase in the dansylated lecithin intensity that coincides with a dansyl blue shift. The extent of the blue shift correlates with the level of diacylglycerol generated in situ by PLC, suggesting an increased association between dansylated lecithin and cholesterol as membrane fluidity increases and membrane polarity decreases. The subsequent increase in the fluorescence ratio results from both an increase in the dehydroergsterol intensity and a concomitant decrease in the dansylated lecithin intensity of equal magnitude. This signifies a reduction in energy transfer from dehydroergosterol to dansylated lecithin and indicates an increased separation between the two fluorophores. The increase in the fluorescence ratio persists beyond the time scales for vesicle aggregation and fusion, as measured by turbidity, and precedes the onset of macroscopic cholesterol crystals observed with an optical microscope. Thus, the increased separation between dehydroergosterol and dansylated lecithin is consistent with a mechanism of cholesterol nucleation from the vesicles. Moreover, the onset and rate of increase in the fluorescence ratio correlate with the cholesterol:lecithin mole ratio of the vesicles. Fluorescence energy transfer from dehydroergosterol to dansylated lecithin therefore shows potential as a methodology for measuring cholesterol nucleation in model bile.