Inverted micellar aggregates and the W/O-microemulsion domain of the system H2O/AOT/i-C8H18 have been investigated at various temperatures, AOT and H2O concentrations, and molar ratios [H2O]/[AOT] in the range 0-60 using photon-correlation spectroscopy. Experimental evidence is presented that a clear distinction is possible between micellar and swollen micellar solutions, i.e., microemulsions, according to the degree of hydration or the amount of solubilized water, respectively. The onset of the phenomena characteristic for microemulsions occurs when water becomes the major component in the colloidal aggregates. Moreover, it is shown that the conventional definition of the microemulsion domain with respect to the upper boundary is artificial since there is no discontinuity in the property of the microemulsion. Also the so-called free" water concept is discussed in the light of the results presented. © 1979 American Chemical Society."