Colloidal systems, including micellar and reverse micellar mixtures, are essential for a variety of natural transport processes, such as the flow of organic and inorganic contaminants in lakes, rivers, and underground fissures. Thus, an understanding of their structure and stability is important for prediction of their behavior in complex environments. Previous experiments have shown that the solvodynamic diameters (D) of reverse micelles contract linearly with increased concentrations of salts such as NaBH4, FeSO4, Mg(NO3)2, CuCl2, Al(NO3)3, Fe(NO3)3, and Y(NO3)3. It has also been previously determined that reverse micelle size is a function of cation valency, through the Debye screening length (κ–1), and of anion hydrated radius. Here, we present a new theoretical model for the aqueous reverse micelle core substructure in water/AOT/isooctane colloidal systems with added salts. Our model is based on electrical double layer (EDL) theory and assumes ions are evenly distributed within the reverse micelle water core. We further analyze reverse micelle size with respect to ion hydration, reverse micelle water dynamics, and ion distribution, to propose a mechanism for reverse micelle contraction and determine the cause of system instability at the critical destabilization concentration for each salt. We find that destabilization occurs when the interfacial core water and waters needed for complete ion hydration exceed the water contained within the reverse micelle at its stable size. This establishes ion hydration capacity a likely primary mechanism for reverse micelle destabilization.