This paper describes a novel method of producing a microcrystalline oral suspension containing beta-sitosterol in oil for the treatment of hypercholesterolaemia. beta-Sitosterol pseudopolymorphs with different water contents were crystallized from acetone and acetone-water solutions. Structural analyses of the crystals were performed by Karl-Fisher titration, thermogravimetric analyses, X-ray diffraction and near infrared spectroscopy. The suspensions studied were composed of different concentrations of beta-sitosterol, oil and water. Suspensions were prepared by crystallization of hot concentrated solution of beta-sitosterol in oil by cooling with simultaneous agitation and water addition. The structural analyses of the suspensions were performed by X-ray diffraction, near infrared spectroscopy and optical microscopy. The viscosity of the suspensions was analysed as a function of shear stress. beta-Sitosterol was observed to exist in three different forms: anhydrous, hemihydrated and monohydrated crystals. By changing both the beta-sitosterol and the water concentration of the suspension, the crystal size and shape could be controlled. Addition of water resulted in the formation of monohydrated needle-shaped crystals instead of platy-like anhydrous crystals. Needle-shaped particles formed structured suspensions with shear thinning behaviour. By increasing the volume fraction of solid particles in suspension by increasing the water and/or sterol concentration, the viscosity increased. A high sterol concentration resulted in high supersaturation and thus formation of small crystals.