  The small instanton transition of a five-brane colliding with one end of the
S1/Z2 interval in heterotic M-theory is discussed, with emphasis on the
transition moduli, their potential function and the associated non-perturbative
superpotential. Using numerical methods, the equations of motion of these
moduli coupled to an expanding Friedmann-Robertson-Walker spacetime are solved
including non-perturbative interactions. It is shown that the five-brane
collides with the end of the interval at a small instanton. However, the moduli
then continue to evolve to an isolated minimum of the potential, where they are
trapped by gravitational damping. The torsion free sheaf at the small instanton
is ``smoothed out'' into a vector bundle at the isolated minimum, thus
dynamically completing the small instanton phase transition. Radiative damping
at the origin of moduli space is discussed and shown to be insufficient to trap
the moduli at the small instanton point.
