The binding of [2,2'-bipyridyl]-3,3'-diol (BP(OH)(2)) with ionic and neutral surfactants like cetyltrimethylammonium bromide (CTAB), sodium dodecyl sulfate (SDS), and Triton X-100 (TX-100) has been studied by steady-state and time-resolved fluorescence spectroscopy. The absorption as well as emission spectra of BP(OH)(2) are highly sensitive toward the variation of surfactant concentration and hydrophobicity of the environment. The fluorescent state of the diketo form gains stability in surfactant assemblies, leading to a red-shifted emission spectra. A sharp increase in the fluorescence quantum yield near critical micellar concentration (CMC) is encountered followed by saturation. This indicates a complete encapsulation of BP(OH)(2) in the micelles. The maximum fluorescence quantum yield in anionic SDS is rationalized by the formation of cationic fluorophore at the Stern layer. The increase in quantum yield in neutral TX-100 is attributed to higher microviscosity experienced by the fluorophore in the palisade layer. A direct support in favor of this argument in TX-100 is provided by the viscosity dependence exhibited by the probe in different concentrations of sucrose solutions. CTAB exhibiting only hydrophobic effect shows least increase in qunatum yield of BP(OH)(2) among all the surfactants. Time-resolved fluorescence study of BP(OH)(2) in micelles is used as a tool to monitor the extent of micellization in the lipophilic cavity. An increase in fluorescence quantum yield as well as lifetime of BP(OH)2 upon micellization indicates an enhanced extent of ESIDPT in hydrophobic medium.