Oriented dipalmitoyllecithin-cholesterol multibilayers with 11% water have been studied with the cholestane spin label. From the ESR spectra the order parameters and the mobility of the spin label about its long axis have been calculated. The results on pure lecithin multibilayers indicate a transition from gel to liquid crystalline phase at 52 plus or minus 2 degrees C. In the gel phase the lecithin alkyl chains are highly ordered, but tilted with respect to the normal to the bilayers by about 25 degrees. Above 52 degrees C the tilt disappears and the mobility of the cholestane spin label increases, indicating an increase of mobility of the lecithin alkyl chains. When cholesterol is added, below about 52 degrees C a decrease of order is found. Furthermore, already small cholesterol contents (smaller than or equal to 10 mole %) remove the tilt. Above about 52 degrees C cholesterol improves the order by decreasing the amplitude of the librational motions. Cholesterol lowers the transition temperature of the system and reduces the mobility of the lecithin alkyl chains in the liquid crystalline phase. However an increase in mobility is found at cholesterol contents up to 10 mole %. A very broad phase transition is observed at 50 mole % cholesterol. In all systems an increase in temperature results in a reduction of order through an increase of the amplitude of the librational motions of the molecules. The librational motions are to some extent cooperative. The asymmetry of the order matrix is found to be a measure for the lateral ordering. Cholesterol increases the lateral ordering, indicating that the flat cholesterol molecules orient parallel to each other.