Photophysical properties of 3-acetyl-4-oxo-6,7-dihydro-12H indolo-[2,3-a] quinolizine (AODIQ have been studied in different aqueous micellar environments using steady-state and time-resolved emission spectroscopy. The charge transfer (CT) fluorescence exhibits appreciable hypsochromic shift, along with an enhancement in the fluorescence intensity in all the micellar media. This is associated with an increase in the fluorescence anisotropy (r), which suggests that the fluorophore molecule experiences motionally restricted environments upon binding with the micelles. Fluorescence spectral position and fluorescence quenching studies suggest that the fluorescing moiety does not penetrate into the core of the micellar units; rather it binds at the micelle-water interfacial region. The binding constant and free energy change during probe-micelle binding have been evaluated from relevant fluorescence data. Light has been thrown on the mode of action of urea on micelle bound probes. The results are interpreted in terms of the model that urea displaces water molecules from the micellar interface and the consequent destabilization leads to the expulsion of the probe molecules from the interfacial region. Polarity and viscosity of the microenvironments around the probe have been determined in the micellar systems. (C) 2004 Elsevier Inc. All rights reserved.