A fluorescent galactoside, 2-(N-dansyl)-aminoethyl beta-D-thiogalactoside (dansyl-galactoside), competitively inhibits lactose transport by membrane vesicles of Escherichia coli, but is not actively transported. An increase in dansyl-galactoside fluorescence is observed upon addition of D-lactate. The fluorescence increase is not observed in membrane vesicles lacking the beta-galactoside transport system, and is blocked or rapidly reversed by addition of beta-galactosides, sulfhydryl reagents, inhibitors of D-lactate oxidation, or uncoupling agents. The fluorescence increase exhibits an emission maximum at 500 nm and excitation maxima at 345 nm and at 292 nm. The latter excitation maximum is absent unless D-lactate is added, indicating that the bound dansyl-galactoside molecules are excited by energy transfer from the membrane proteins. Titration of vesicles with dansyl-galactoside in the presence of D-lactate demonstrates that the beta-galactoside carrier protein represents about 3.3% of the total membrane protein. The data indicate that D-lactate oxidation leads to binding of the fluorescent galactoside to the beta-galactoside carrier protein in such a manner that the dansyl group is transferred to a hydrophobic environment within the membrane.