Introduction: Peripheral proteins associated at the lipid surface are one of the major components of biological membranes. They may function in situ as electron carriers (e.g. cytochrome c), as enzymes (e.g. protein kinase C), as signal transduction proteins (e.g. G-proteins), or primarily as structural elements (e.g. spectrin and myelin basic protein). The protein density at the membrane surface can be relatively high and the peripheral proteins may also interact with the exposed portions of integral proteins embedded within the membrane (e.g. with redox enzymes of the respiratory chain, or with receptors such as those to which G-proteins are coupled). The association with the membrane is most frequently of electrostatic origin, but may also include surface adsorption and hydrophobic components. The interactions of the isolated peripheral proteins with lipid bilayer membranes therefore are of direct relevance to the structure and function of biological membranes, and the determination of binding isotherms has proved to be particularly useful in the study of such interactions. Analysis of the latter constitutes the first, and an important part, of this chapter that is directly relevant to the thermodynamics of binding. From a biophysical point of view, the binding of peripheral proteins to lipid membranes has a profound influence on parameters such as the electrostatic surface potential or the enthalpy and the heat capacity of the lipid-protein system. These parameters determine the phase transition behavior of lipid membranes as well as the energetics of the binding reaction itself. At temperatures close to a phase transition, the thermodynamic properties of protein binding cannot be considered separately from, for example, the chain-melting reactions. It is evident from calorimetric heat capacity profiles that the chain-melting of lipids is influenced by the binding of proteins. As a direct consequence, the binding of proteins must be influenced by changes in the lipid state. Therefore, the change in lipid state will show up in the behavior of binding isotherms of proteins to membranes. Correspondingly, the binding reaction will result in shifts, broadening or enthalpy changes of the calorimetric heat capacity profiles of lipid chain-melting. Also, structural changes in the lipid matrix might occur as a consequence of protein binding due to the change in the overall physical properties of the lipid-protein complex. Consideration of the lipid chain-melting transition, and its coupling to the lipid binding and lipid-protein interactions, from a thermodynamic point of view constitutes the second part of this chapter. Although most principles described below are generally applicable, in the following we shall restrict the thermodynamic treatment of protein binding at the membrane to extended planar lipid surfaces. A goal of this chapter is to link the thermodynamics of binding with that of chain-melting and to discuss the consequences for protein function. For this, we first outline a general description of the electrostatics of binding as a function of ionic strength and lipid composition with emphasis particularly on binding isotherms for continuous membrane surfaces. We then apply some of the results to the description of the chain-melting reaction in the presence of proteins. It will be shown that changes of the state of the membrane can result in a change of the protein distribution on the surface, as well as in changes in the forces acting on the bound proteins. These changes correlate with functional changes observed in some proteins. We shall discuss several examples for integral and peripheral proteins, where lipid chain-melting and function of the protein are in a clear relation to each other.