Models created with molecular dynamics simulations are used to compare the organization and dynamics of cholesterol (Chol) molecules in three different environments: (1) a hydrated pure Chol bilayer that models the Chol bilayer domain, which is a pure Chol domain embedded in the bulk membrane; (2) a 2-palmitoyl-3-oleoyl-d-glycerol-1-phosphorylcholine bilayer saturated with cholesterol (POPC-Chol50) that models the bulk membrane; (3) a Chol crystal. The computer model of the hydrated pure Chol bilayer is stable on the microsecond time scale. Some structural characteristics of Chol molecules in the Chol bilayer are similar to those in the POPC-Chol50 bilayer (e.g., tilt of Chol rings and chains), while others are similar to those in Chol crystals (e.g., surface area per Chol, bilayer thickness). The key result of this study is that the Chol bilayer has, unexpectedly, a dynamic structure, with Chol mobility similar to that in the POPC-Chol50 bilayer though slower. This is the major difference compared to Chol crystals, where Chol molecules are immobile. Also, water accessibility to Chol-OH groups in the Chol bilayer is not limited. On average, each Chol molecule makes 2.3 hydrogen bonds with water in the Chol bilayer, compared with 1.7 hydrogen bonds in the POPC-Col50 bilayer.