The binding of native cytochrome c to negatively charged lipid dispersions of dioleoyl phosphatidylglycerol has been studied over a wide range of ionic strengths. Not only is the strength of protein binding found to decrease rapidly with increasing ionic strength, but also the binding curves reach an apparent saturation level that decreases rapidly with increasing ionic strength. Analysis of the binding isotherms with a general statistical thermodynamic model that takes into account not only the free energy of the electrostatic double layer, but also the free energy of the surface distribution of the protein, demonstrates that the apparent saturation effects could arise from a competition between the out-of-plane binding reaction and the lateral in-plane interactions between proteins at the surface. It is found that association with nonlocalized sites results in binding isotherms that display the apparent saturation effect to a much more pronounced extent than does the Langmuir adsorption isotherm for binding to localized sites. With the model for nonlocalized sites, the binding isotherms of native cytochrome c can be described adequately by taking into account only the entropy of the surface distribution of the protein, without appreciable enthalpic interactions between the bound proteins. The binding of cytochrome c to dioleoyl phosphatidylglycerol dispersions at a temperature at which the bound protein is denatured on the lipid surface, but is nondenatured when free in solution, has also been studied. The binding curves for the surface-denatured protein differ from those for the native protein in that the apparent saturation at high ionic strength is less pronounced. This indicates the tendency of the denatured protein to aggregate on the lipid surface, and can be described by the binding isotherms for nonlocalized sites only if attractive interactions between the surface-bound proteins are included in addition to the distributional entropic terms. Additionally, it is found that the binding capacity for the native protein is increased at low ionic strength to a value that is greater than that for complete surface coverage, and that corresponds more closely to neutralization of the effective charge (determined from the ionic strength dependence), rather than of the total net charge, on the protein. Electron spin resonance experiments with spin-labeled lipids indicate that this different mode of binding arises from a penetration or disturbance of the bilayer surface by the protein that may alleviate the effects of in-plane interactions under conditions of strong binding.