This article describes the interaction of a micelle entrapped pharmaceutically important isoindole fused imidazole derivative, namely, 1-(2-hydroxy-5-methyl-phenyl)-3,5-dioxo-1H-imidazo-[3,4-b] isoindole (ADII), with the model transport protein bovine serum albumin (BSA). Different spectroscopic techniques such as steady state absorption, emission, circular dichroism, dynamic light scattering, etc., have been employed to explore preferential interaction of this drug template with micelles and protein BSA. Binding of ADII with BSA is found to be enormously modified when it is released from the micellar environment. The binding constant of the ADIIBSA complex is reduced when the probe is released from anionic SDS micelle, whereas the binding is observed to be strengthened in cationic CTAB micellar medium due to the formation of a 1:2 complex (ADIIBSA). Time-resolved studies also support our steady state findings that the released drug from the micellar environment is found to be strongly bound with the protein BSA. Circular dichroism (CD) and dynamic light scattering (DLS) study reveals that the secondary structure of BSA gets some stabilization in SDS medium after binding of drug template to protein. The probable binding location of the probe within the protein cavity (hydrophilic subdomain IA) has been explored from an AutoDock-based blind docking simulation study.