Here we reveal details of the interaction between human lysozyme proteins, both native and fibrils, and their water environment by intense terahertz time domain spectroscopy. With the aid of a rigorous dielectric model, we determine the amplitude and phase of the oscillating dipole induced by the THz field in the volume containing the protein and its hydration water. At low concentrations, the amplitude of this induced dipolar response decreases with increasing concentration. Beyond a certain threshold, marking the onset of the interactions between the extended hydration shells, the amplitude remains" fixed but the phase of the induced dipolar response, which is initially in phase with the applied THz field, begins to change. The changes observed in the THz response reveal protein protein interactions mediated by extended hydration layers, which may control fibril formation and may have an important role in chemical recognition phenomena.