Substrates insoluble in water are often presented to enzymes in micellized form. We observed anomalous increases in activities of lipases, with p-nitrophenyl oleate (PNPO)-Triton X-100 mixed micelles as the substrate system, in the presence of the protein denaturant guanidinium chloride (GdmCl). However, with the water-soluble substrate p-nitrophenyl acetate (PNPA), the activity of the lipases decreased with increasing concentrations of GdmCl. Since chaotropes are known to affect micellar systems, we investigated the effects of GdmCl on the structure of the micelles and on the reactivity of PNPO present in mixed micellar form with Triton X-100. GdmCl does not affect the nonenzymatic hydrolysis rate of the water-soluble substrate PNPA substantially; however, the hydrolysis of PNPO is enhanced 74-fold on increasing GdmCl concentration from 0 to 6 M. This is accompanied by a 50% decrease in hydrodynamic radius of the micelles and a 25 times increase in critical micellar concentration. Polarity measurements and quenching studies with various analogues of anthroyloxy stearic acid incorporated into the Triton X-100 micelles indicated that in the presence of GdmCl the polarity extends deeper into the micelle. Quenching with the nonpolar quencher dimethylaniline decreases in the presence of GdmCl due to altered partitioning of the quencher. Increased quenching with the polar quencher iodide confirms increased water penetration in the presence of GdmCl. Polarization of the anthroyloxy moiety in GdmCl reported a progressively restrictive environment for probe mobility. Nonionic micelles such as Triton X-100 do not possess the intrinsic ability to catalyze hydrolysis reactions similar to ionic micelles; however, the present investigation demonstrates that perturbation of nonionic micelles could lead to catalytic ability.