High-resolution protein ground-state structures of proton pumps and channels have revealed internal protein-bound water molecules. Their possible active involvement in protein function has recently come into focus. An illustration of the formation of a protonated protein-bound water cluster that is actively involved in proton transfer was described for the membrane protein bacteriorhodopsin (bR) [Garczarek F, Gerwert K (2006) Nature 439:109-112]. Here we show through a combination of time-resolved FTIR spectroscopy and molecular dynamics simulations that three protein-bound water molecules are rearranged by a protein conformational change that resulted in a transient Grotthuss-type proton-transfer chain extending through a hydrophobic protein region of bR. This transient linear water chain facilitates proton transfer at an intermediate conformation only, thereby directing proton transfer within the protein. The rearrangement of protein-bound water molecules that we describe, from inactive positions in the ground state to an active chain in an intermediate state, appears to be energetically favored relative to transient incorporation of water molecules from the bulk. Our discovery provides insight into proton-transfer mechanisms through hydrophobic core regions of ubiquitous membrane spanning proteins such as G-protein coupled receptors or cytochrome C oxidases.