Colloidal interactions between particles in a dispersion can be tuned by grafting polymeric chains onto the surface of the particles. The affinity between the polymeric chains and the continuous-phase liquid controls the strength of these interactions. In our system the polymer-liquid affinity is strongly influenced by temperature, and as a result, dramatic changes occur in the dispersion microstructure on heating. The system is an aqueous dispersion of polystyrene (PS) particles bearing grafted poly(ethylene oxide) (PEO) chains of low molecular weight ( similar to 2000). At room temperature, water is a good solvent for PEO chains, and the dispersion is a stable, low-viscosity sol. As temperature is increased, water becomes a progressively worse solvent for PEG. Beyond a temperature T-c there is a sharp transition in microstructure from a stable sol to a volume-filling gel. The sol-gel transition is reversible and the transition temperature T-c can be pinpointed using tan delta versus temperature plots. Remarkably, T-c is more than 100 OC lower than the a temperature for PEO (2000) in water, i.e., the gelation occurs under significantly better-than-theta conditions. T-c is independent of particle concentration, but is strongly influenced by the graft density of PEO chains on the particles. The higher the graft density, the higher the T-c for gelation; conversely, at very low graft density, the samples are gels even at room temperature. Above T-c, the elastic modulus (G ') of the gels reveals a power law dependence with particle volume fraction (phi), i.e., G ' proportional to phi (n) . The power law exponent n is independent of the PEO graft density, implying that the various gels have a similar microstructure. We suggest that gelation is the result of a weak secondary minimum in the interparticle potential that can develop in the case of short stabilizing moieties and moderate solvent conditions.