The effect of increasing water composition on the rheological and microstructural behavior of a ternary cellulose acetate (CA)/N,N-dimethylacetamide (DMA)/water system is examined. Addition of water to the CA/DMA system results in enhanced steady shear viscosity and dynamic viscoelastic properties and ultimately to phase-separated gel formation. The changes in dynamic rheological behavior of the system during gelation correlate well with the combined solubility parameter (delta) and, in particular, the Hansen hydrogen-bonding solubility parameter index (delta(h)) of the solvent system, suggesting hydrogen-bonding interactions may be the major route initiating the sol-gel process. For all gels studied, the elastic modulus and the critical stress to yield shifts to higher values with increasing CA concentration and/or water content. In addition, the elastic modulus exhibits a power-law behavior with water content, with the same power-law exponent observed for gels containing different CA concentrations. Addition of water leads to formation of a denser gel network, as evidenced from direct visualization of the gel microstructure through confocal microscopy.