An optical storage system and method having separate, independent format hologram writing and data writing mechanisms to allow optimization of data writing separately from format hologram recording. In its most general terms, the invention comprises an optical medium having a first, photoactive material responsive to a first, format hologram recording condition and a second photo-active material, responsive to a second, data writing condition, which is dispersed or dissolved in the first photoactive material. The second photoactive material may additionally be "erasable" under a third, erasing condition. The second photoactive material is preferably in the form of microparticles, microdroplets or microcapsules which are dispersed throughout the first photoactive material. The format hologram is recorded in the first photoactive material when the optical medium is subject to the first, format hologram recording condition, and the data writing is subsequently carried out separately, in connection with the second photoactive material, under the second, data writing condition. The separate format hologram recording and bit writing functions provided by the diferent conditions make them orthogonal.