Mixed dihydroxy bile salt-phosphatidylcholine (PC) micelles can inhibit the hydrolysis of gum arabic-stabilized long-chain triglyceride emulsions by 10(-8) to 10(-9) M concentrations of human pancreatic lipase and colipase. Trypsin treatment of this colipase preparation did not reverse the inhibition, suggesting that procolipase, as a possible contaminant, was not the inhibitory factor. Human biliary phospholipid-cholesterol liposomes, isolated by gel filtration and redissolved in bile salt solutions, inhibited lipolysis to the same degree as solutions of bile salt containing purified PC. The degree of inhibition depended principally on the species of bile salt present (e.g., taurochenodeoxycholate greater than taurodeoxycholate greater than tauroursodeoxycholate greater than taurocholate). In the absence of bile salt, PC (0.4 mM) liposomes alone were not inhibitory over the physiological time range studied. Bile salt solutions of phosphatidylethanolamine or sphingomyelin also inhibited lipase activity, whereas those containing oleyl alcohol, oleyl aldehyde, oleic acid, and lyso-PC did not. PC molecules were found to partition between the triglyceride emulsion interface and the bulk aqueous phase. Full reversal of inhibition occurred in the presence of phospholipase A2, which hydrolyzed the phospholipids to lysolecithin and fatty acids. Mixed bile salt-phospholipid micelles caused marked decrease in the binding of lipase and colipase to the triglyceride substrate and displaced the proteins into the aqueous phase. The results taken together suggest that colipase binds to certain bile salt-PC associations independent of whether the aggregates are located at the surface of a triglyceride particle as a monolayer or in the bulk aqueous phase as mixed micelles.