We report a single-molecule fluorescence resonance energy transfer (FRET) and polarization study of conformational dynamics of calmodulin (CaM) interacting with a target peptide, C28W of a 28 amino acid oligomer. The C28W peptide represents the essential binding sequence domain of the Ca-ATPase protein interacting with CaM, which is important in cellular signaling for the regulation of energy in metabolism. However, the mechanism of the CaM/C28W recognition complex formation is still unclear. The amino-terminal (N-terminal) domain of the CaM was labeled with a fluorescein-based arsenical hairpin binder (FlAsH) that enables our unambiguous probing of the CaM N-terminal target-binding domain motions on a millisecond time scale without convolution of the probe-dye random motions. By analyzing the distribution of FRET efficiency between FlAsH labeled CaM and Texas Red labeled C28W and the polarization fluctuation dynamics and distributions of the CaM N-terminal domain, we reveal binding-unbinding motions of the N-terminal domain of the CaM in CaM/C28W complexes, which is strong evidence of a two-state binding interaction of CaM-mediated cell signaling.