FDAPT (2-formyl-5-(4'-N,N-dimethylaminophenyl)thiophene) efficiently senses the minimum alteration of lipid bilayer microenvironment with all six different fluorescence parameters namely emission wavelength, fluorescence intensity, steady-state anisotropy, and their corresponding time-dependent parameters (Sahu et al., J. Phys. Chem. B 2018, 122, 7308-7318). In the present work, the effect of poly(ethylene glycol) on the small unilamellar vesicle is demonstrated with the emission behavior of the FDAPT probe. A medium and a high molecular weight PEG were chosen to perturb the lipid vesicles. The alteration of the bilayer polarity, water content inside bilayer, lipid packing density in the perturbed vesicles reflect significant changes in different fluorescence parameters of FDAPT probe. The effect of PEG on the unilamellar vesicle was rationalized with the alteration of the emission behavior, fluorescence lifetime, steady-state anisotropy and anisotropy decay of the probe. The simple and convenient fluorescence measurements provide new insights into the effect of PEG on the packing density, water volume, micro polarity, and microviscosity of the small unilamellar vesicle. The physiological understanding was extended to rationalize the cryoprotecting behavior of PEG.