A series of hydrophobically and electrostatically modified polyacrylamides (Copol(AM-C12)) has been synthesized by radical-initiated copolymerization of acrylamide with n-dodecylmethyldiallylammonium bromide as the hydrophobe in aqueous solution using ammonium persulfate as the initiator. The formation of hydrophobic microdomains of the copolymers was revealed by large hypsochromic shifts of the long-wavelength absorption band of the solvatochromic probe Methyl Orange, noncovalently bound to the macromolecule. It was found that the microdomains formed by these copolymers in aqueous solution are more hydrophobic than those of the cationic polysoaps poly(alkylmethyldiallylammonium halides) containing the same n-dodecyl groups as the side chains as a result of the reduced electrostatic repulsions at the periphery of the microdomains. The reduced cationic character of the copolymers Copol(AM-C12) most likely also accounts for the observation that the anionic dye Methyl Orange does not; induce microdomain formation in aqueous solution. The effect of the hydrophobically and electrostatically modified polyacrylamides on the unimolecular decarboxylation of 6-nitrobenzisoxazole-3-carboxylate anion (6-NBIC) has been investigated in aqueous solutions at pH 11.3 and 30 degrees C. It is suggested that the relatively modest catalytic effects induced by Copol(AM-C12) should be ascribed to hydrogen-bond stabilization of the initial state by NH groups in the macromolecules. The decarboxylation rates of 6-NBIC at binding sites in hydrophobic microdomains increase with increasing n-dodecyl group content in the copolymers.