Functional membrane proteins in the plasma membrane are suggested to have specific membrane environments that play important roles to maintain and regulate their function. However, the local membrane environments of membrane proteins remain largely unexplored due to the lack of available techniques. We have developed a method to probe the local membrane environment surrounding membrane proteins in the plasma membrane by covalently tethering a solvatochromic, environment-sensitive dye, Nile Red, to a GPI-anchored protein and the insulin receptor through a flexible linker. The fluidity of the membrane environment of the GPI-anchored protein depended upon the saturation of the acyl chains of the lipid anchor. The local environment of the insulin receptor was distinct from the average plasma membrane fluidity and was quite dynamic and heterogeneous. Upon addition of insulin, the local membrane environment surrounding the receptor specifically increased in fluidity in an insulin receptor-kinase dependent manner and on the distance between the dye and the receptor.