The effects of polyethylene glycol (PEG) on protein structure and the molecular details that regulate its association to polypeptides are largely unknown. These issues were addressed using type I soluble tumor necrosis factor receptor (sTNF-RI) as a model system. Changes in solution viscosity established that a truncated form of sTNF-RI bound free PEG in a pH-dependent manner. Above pH 5.3, the viscosity escalated as the pH increased, while no effect occurred below pH 5.0. Conjugation of 2 kD, 5 kD, or 20 kD PEG to the N terminus attenuated the viscosity at the higher pH values. Tryptophan phosphorescence spectroscopy correlated changes in the protein structure about Trp-107, at the C terminus, with the pH-dependent and PEGylation-dependent attenuation of the viscosity. The results indicate that specific interactions between PEG and the truncated form of sTNF-RI are elicited by an increased flexibility of the truncated protein combined perhaps with removal of steric or charge barriers. Covalently bound PEG at the N terminus reduced the protein affinity for the free polymer and induced a more rigid and polar configuration around Trp-107. Deprotonation of His-105, which is perpendicular to Trp-107, was integral to the binding mechanism producing a pH-dependent switching mechanism. These findings stress the importance of surface charge and structural plasticity in determining macromolecular binding affinities and demonstrate the ability of conjugated PEG to modify the localized surface structure in proteins away from the site of conjugation.