Spontaneous emulsification, intermediate phase formation, and other dynamic behavior were studied for various ternary and quaternary systems containing hydrocarbon, alcohol, surfactant and water, using several experimental techniques such as oil drop and vertical cell contacting experiments using a videomicroscopy system, and macro-scale emulsification experiments in some systems. Experiments were conducted when surfactant was initially located in the aqueous phase and when it was initially in the oil phase. An extended quasi-steady-state approximation theory for the diffusion process was developed to describe the dynamic behavior, especially intermediate phase formation, which occurred when a drop of a polar oil having an appreciable water solubility contacted a dilute surfactant solution. Extensive experimental results for heptanol drops contacting dilute amine oxide solutions showed a consistency with the theory. It was found that spontaneous emulsification in hydrocarbon/hydrophilic nonionic or zwitterionic surfactant/hydrophobic alcohol/water systems was caused by the local supersaturation mechanism wherever the surfactant was initially located. In order to produce complete spontaneous emulsification of an oil drop in water, the oil phase should contain initially an optimum content of alcohol, which is near the oil composition at the phase inversion temperature (PIT) condition for water-insoluble alcohols and somewhat higher for slightly water-soluble alcohols. In either case the equilibrium phase behavior and diffusion must combine in such a way that the drop is completely converted to a microemulsion or the lamellar liquid crystalline phase which subsequently becomes supersaturated in oil, causing nucleation of small oil droplets. This sequence of events stems from the drop being made more hydrophilic by some combination of alcohol diffusion into the aqueous phase, surfactant diffusion into the drop (when it is initially in the aqueous phase), and hydration of the ethylene oxide groups of a nonionic surfactant (when it is initially in the oil). The results show that a proper combination of a hydrophilic nonionic surfactant and a hydrophobic alcohol dissolved in oil can induce its complete spontaneous emulsification in water. However, addition of a single, pure surfactant near its PIT to an oil does not produce complete spontaneous emulsification because the phase behavior does not permit the above sequence of events to occur.