Photophysical studies of photoinduced electron transfer (PET) and non-PET based acridinedione dyes with guanidine hydrochloride (GuHCl) were carried out in water and methanol. Addition of GuHCl to photoinduced electron transfer (PET) based acridinedione dye (ADR 1) results in a fluorescence enhancement, whereas a non-PET based dye (ADR 2) shows no significant change in the fluorescence intensity and lifetime. Addition of GuHCl to ADR 1 dye in methanol results in single exponential decay behaviour, on the contrary a biexponential decay pattern was observed on the addition of GuHCl in water. Absorption and emission spectral studies of ADR 1 dye interaction with GuHCl reveals that the dye molecule is not in the protonated form in aqueous GuHCl solution, and the dye is confined to two distinguishable microenvironment in the aqueous phase. A large variation in the microenvironment around the dye molecule is created on the addition of GuHCl and this was ascertained by time-resolved area normalized emission spectroscopy (TRANES) and time-resolved emission spectroscopy (TRES). The dye molecule prefers to reside in the hydrophobic microenvironment, rather in the hydrophilic aqueous phase is well emphasized by time-resolved fluorescence lifetime studies. The mechanism of fluorescence enhancement of ADR 1 dye by GuHCl is attributed to the suppression of the PET process occurring through space.