The effect of cholesterol on the Ca2+-induced aggregation and fusion of large unilamellar phosphatidylserine (PS) vesicles has been investigated. Mixing of aqueous vesicle contents was followed continuously with the Tb/dipicolinate assay, while the dissociation of pre-encapsulated Tb/dipicolinate complex was taken as a measure of the release of vesicle contents. Vesicles consisting of pure PS or PS/cholesterol mixtures at molar ratios of 4:1, 2:1 and 1:1 were employed at three different lipid concentrations, each at four different Ca2+ concentrations. The results could be well simulated in terms of a mass-action kinetic model, providing separately the rate constants of vesicle aggregation, c11, and of the fusion reaction itself, f11. In the analyses the possibility of deaggregation of aggregated vesicles was considered explicitly. Values of both c11 and f11 increase steeply with the Ca2+ concentration increasing from 2 to 5 mM. With increasing cholesterol content of the vesicles the value of c11 decreases, while the rate of the actual fusion reaction, f11, increases. Remarkably, the effect of cholesterol on both aggregation and fusion is quite moderate. The presence of cholesterol in the vesicle bilayer does not affect the leakage of vesicle contents during fusion.