The intention of this study is to investigate the evolution and transition of lyotropic lamellar phase and the formation of multi-lamellar vesicles (MLVs) under shear flow, since the shear technology can be used to produce well defined multi-lamellar vesicles which are useful for encapsulating drugs in medical or research fields. The system was designed to stabilize and track one single multi-lamellar vesicle, which is being sheared under Couette shear flow between two co-rotational disks, by using polarizing microscope and a LabView program. For the whole system, most parts of the hardware instrument and all the software programs were originally designed and homemade, which makes this a unique undertaking. Eighty percent of the time was spent on designing, assembling, testing and improving the hardware instrument and software programs to make sure the system can achieve our aim as accurately as possible. The lyotropic lamellar phase sample is made of pentanol, dodecane, SDS and water. Nine different concentrations from 16% to 32% of SDS+Water were explored under five different shear rates from 3.3 to 13.2 . Sodium dodecyl sulfate (SDS) is a kind of surfactant which has an amphiphilic molecular structure, and a certain liquid crystal structure (such as a lamellar phase) will be formed when it is dissolved in a water/oil mixture solvent. It is a great achievement that one single multi-lamellar vesicle is able to be followed for over 20 minutes under shear, and it is found that the multi-lamellar vesicle does not exhibit any obvious changes with time once it was already formed. Three different structural regions were found for the dilute lamellar phase while evolving to the multi-lamellar vesicle orientation state under shear. However, only two regions were found for the lamellar phase with higher concentrations under low shear rate since the lamellar phase will not reach to the multi-lamellar vesicle state. Besides, on the basis of the results of these experiments, it can be concluded that either higher shear rate or higher concentration of SDS+Water will hasten the formation of multi-lamellar vesicles. For the transition time of reaching a uniform multi-lamellar vesicle orientation state, it can be reduced by increasing shear rate. In addition, the results show that the transition time is decreasing more slowly for high concentrated lamellar phases than dilute lamellar phases with increasing the shear rate.