Experiments were performed to assess three possible mechanisms of poly(ethylene glycol) (PEG) induced rapid lipid transfer between large unilamellar vesicles composed of dioleoylphosphatidylcholine: (1) transfer between aggregated vesicles, (2) transfer through an aqueous medium of lowered dielectric constant, and (3) transfer via a PEG carrier. The results showed that close contact between vesicles as a result of PEG dehydration was largely responsible for the rapid lipid transfer observed in the presence of PEG. The rate and extent of lipid transfer were also examined at 10 wt % PEG and analyzed in terms of a two-state model especially developed to account for the initial rate of lipid transfer as followed by the fluorescence lifetime of DPHpPC as a fluorescent lipid probe. Analysis revealed that two rate processes were involved in DPHpPC transfer between bilayers, both in the absence and presence of PEG. Since the maximum extent of transfer was 50%, transbilayer diffusion of DPHpPC seemed not to contribute to either process. The fast process in the presence of PEG was identified as due to rapid interbilayer monomer diffusion between closely apposed vesicles, and, in the absence of PEG, as due to monomer diffusion through the aqueous phase. The origin of the slow process, in both cases, remains obscure. The Arrhenius activation energies (and entropies) for the initial rates at temperatures from 10 to 48-degrees-C were 15.3 +/- 0.3 kcal/mol (-26.3 +/- 0.2 eu) and 10.6 +/- 0.5 kcal/mol (-16.1 +/- 0.3 eu) in the absence and presence of PEG, respectively. The slow process was invariant with temperature. From these studies, we propose that PEG enhances the rate of intervesicle lipid transfer by forcing dehydration and aggregation of vesicle bilayers, thereby altering the properties of the aqueous phase between membranes.