Lipid bilayer provides a two-dimensional hydrophobic solvent milieu for membrane proteins in cells. Although the native bilayer is widely recognized as an optimal environment for folding and function of membrane proteins, the underlying physical basis remains elusive. Here, employing the intramembrane protease GlpG ofEscherichia colias a model, we elucidate how the bilayer stabilizes a membrane protein and engages the protein’s residue interaction network compared to the nonnative hydrophobic medium, micelles. We find that the bilayer enhances GlpG stability by promoting residue burial in the protein interior compared to micelles. Strikingly, while the cooperative residue interactions cluster into multiple distinct regions in micelles, the whole packed regions of the protein act as a single cooperative unit in the bilayer. Molecular dynamics (MD) simulation indicates that lipids less efficiently solvate GlpG than detergents. Thus, the bilayerinduced enhancement of stability and cooperativity likely stems from the dominant intraprotein interactions outcompeting the weak lipid solvation. Our findings reveal a foundational mechanism in the folding, function, and quality control of membrane proteins. The enhanced cooperativity benefits function facilitating propagation of local structural perturbation across the membrane. However, the same phenomenon can render the proteins’ conformational integrity vulnerable to missense mutations causing conformational diseases1,2.