Swelling vermiculite clays are ideal systems in which to study confined aqueous and organic fluids. The clay platelets themselves are well characterised and carry a negative charge of around 0.1–0.2 C m–2. To balance this negative layer charge a variety of interlayer counterions can be exchanged into the clay pores. These counterions draw polar solvents, such as water, into the interlayer region, thereby forcing the clay platelets apart. We report on neutron diffraction studies of the hydration of vermiculites containing alkyl ammonium counterions. Owing to the subtle balance between hydrophobic and hydrophilic hydration these particular ions induce a fascinating variety of clay swelling behaviour. When the counterions are methyl or ethyl ammonium, vermiculites will only absorb a maximum of two layers of water. However, increasing the hydrophobic chain length can induce macroscopic colloidal swelling: in dilute aqueous solutions propyl and butyl ammonium vermiculties expand to form 1D colloidal gels, with layer spacings of up to 1000 Å. Surprisingly perhaps, this macroscopic swelling is not observed with slightly longer chain alkyl ammonium counterions, such as pentyl or hexyl. We find that the layer spacing in the macroscopically swollen gels is inversely proportional to the root of the salt concentration in the solution, and that there is a temperature-induced phase transition, in which the gels collapse at high temperatures. In both methyl and butyl ammonium vermiculite the counterions are only loosely bound to the clay platelets, and do not behave as surfactants. In the absence of any strong interlayer structuring we therefore attribute the macroscopic swelling of propyl and butyl ammonium vermiculites to the ability of the hydrophobic chains to weaken the clay–counterions–clay Coulombic attraction, without forming a water repellent micelle-like interlayer region.