Recently, several indications have been found that suggest a preferential interaction between cholesterol and tryptophan residues located near the membrane-water interface. The aim of this study was to investigate by direct methods how tryptophan and cholesterol interact with each other and what the possible consequences are for membrane organization. For this purpose, we used cholesterol-containing model membranes of dimyristoylphosphatidylcholine (DMPC) in which a transmembrane model peptide with flanking tryptophans [acetyl-GWW(LA)8LWWA-amide], called WALP23, was incorporated to mimic interfacial tryptophans of membrane proteins. These model systems were studied with two complementary methods. (1) Steady-state and time-resolved Förster resonance energy transfer (FRET) experiments employing the fluorescent cholesterol analogue dehydroergosterol (DHE) in combination with a competition experiment with cholesterol were used to obtain information about the distribution of cholesterol in the bilayer in the presence of WALP23. The results were consistent with a random distribution of cholesterol which indicates that cholesterol and interfacial tryptophans are not preferentially located next to each other in these bilayer systems. (2) Solid-state 2H NMR experiments employing either deuterated cholesterol or indole ring-deuterated WALP23 peptides were performed to study the orientation and dynamics of both molecules. The results showed that the quadrupolar splittings of labeled cholesterol were not affected by an interaction with tryptophan-flanked peptides and, vice versa, that the quadrupolar splittings of labeled indole rings in WALP23 are not significantly influenced by addition of cholesterol to the bilayer. Therefore, both NMR and fluorescence spectroscopy results independently show that, at least in the model systems studied here, there is no evidence for a preferential interaction between cholesterol and tryptophans located at the bilayer interface.