The development of microdischarges and the inception dynamics of subsequent microdischarges in an electrode arrangement consisting of a metal pin and a hemispherical dielectric-covered electrode, operated in air with a small toluene admixture, is studied. The discharge is operated with sinusoidal high voltage. A gated ICCD camera and a current probe enable the recording of images and current pulses of the single microdischarges, respectively, while the spatio-temporally resolved development is measured with a multi-dimensional time-correlated single photon counting technique. The overall discharge dynamics changes significantly if a concentration of 35ppm toluene is added to dry air. A lower high voltage amplitude than in dry air is needed for stable discharge operation. This can be explained by the lower ionization energy of toluene compared to molecular oxygen and nitrogen. The microdischarge development is the same with or without admixture, i.e. a positive (cathode directed) streamer mechanism is observed. Lower mean power is dissipated into the discharge when toluene is admixed. The main effect caused by toluene admixture is the suppression of high-energy microdischarges in case of the cathodic pin half-cycle of the sinusoidal high voltage. The influence on the inception voltage by additional ionization mechanisms and volume memory effects, the consumption of energetic electrons for toluene decomposition reactions, and the modification of the surface by plasma treatment are discussed as possible reasons.