The effect of co-solvent on phase behavior was evaluated and an optimal surfactant/co-solvent formulation was selected based upon a combination of simulations and laboratory experiments. The co-solvent altered phase behavior, thereby necessitating a different approach for inducing effective salinity gradients. We present an approach where the hydrophilic nature of the co-solvent is used to maintain effective salinity gradients to optimize surfactant behavior but more importantly mitigate viscous microemulsions and reduce surfactant retention. By using a combination of laboratory experiments and simulations to match co-solvent behavior in UTCHEM, Using an understanding into co-solvent partitioning was developed such that the optimal conditions of ultra-low interfacial tensions are maintained for a longer duration during chemical flooding. We demonstrated that by adding the appropriate co-solvent and the correct amount of electrolyte in the chase solutions, we could maintain Winsor type III conditions for extended durations even with a small surfactant slug. The optimal co-solvent/electrolyte gradient recovered more than 90% of the residual oil in laboratory corefloods. The result illustrate the importance of characterizing the effect of co-solvent on surfactant phase behavior and the need for numerical modeling to optimize chemical flood design when co-solvent is used.