The fluorescent probe anilinonaphthalene-8-sulfonate binds to adipocyte lipid binding protein at a site that competes with normal physiological ligands, such as fatty acids. Binding to the protein is accompanied by a relatively large increase in fluorescent intensity. To correlate the major change in optical properties and to determine the mechanism of competitive inhibition with fatty acids, the crystal structure of the protein with the bound fluorophore has been determined. In addition, the thermodynamic contributions to the binding reaction have been studied by titration calorimetry. Because the binding site is in a relatively internal position, kinetic studies have also been carried out to determine k(on). The results indicate that binding is not accompanied by any major conformational change. However, the negatively charged sulfonate moiety is not positioned the same as the carboxylate of fatty acid ligands as determined in previous studies. Nonetheless, the binding reaction is still driven by enthalpic effects. As judged by the crystallographic structure, a significant amount of the surface of the fluorophore is no longer exposed to water in the bound state.