We describe the effects of ethanol on the phase behavior of sodium bis(2-ethylhexyl) sulfosuccinate (AOT), and in particular its ability to form reverse micelles, in n-heptane. Using dynamic light scattering and molecular dynamics simulations, we investigate the aggregation behavior of AOT across a wide range of ethanol/AOT/n-heptane compositions. We conclude that reverse micelles do not form at any of the investigated concentrations, but find other surfactant aggregate morphologies and behaviors unique to this system which vary significantly with changes in ethanol concentration. When the concentration of ethanol is 20 wt.% or below, the system is inhomogeneous with varying sizes of AOT, ethanol, and AOT + ethanol aggregates present. At the lowest ethanol concentrations in this behavior regime, ethanol exhibits co-surfactant behavior almost exclusively, binding at the surface of AOT aggregates. With increased ethanol, the number of independent ethanol clusters increases, and eventually extended interpenetrating networks of AOT and ethanol form. With ethanol concentrations of 20–35 wt.%, increased numbers of ethanol clusters are observed which leads to a more distinct separation of AOT aggregates. These aggregates increase linearly with increased AOT concentration when the system heptane concentration is below 40 wt.%. Most significantly, when the ethanol concentration is raised above 35 wt.%, the solvent environment polarity is high enough such that AOT Na + counterions dissociate from the headgroups and are dissolved in the ethanol. As a result, ethanol hydrogen bonding increases and unique spherical structures of ethanol surrounding AOT aggregates form. These spherical structures continue to increase in size linearly with increased AOT concentration. We use these results to construct a preliminary phase diagram for the ethanol/AOT/n-heptane system.