We designed a host-guest fusion peptide system, which is completely soluble in water and has a high affinity for biological and lipid model membranes. The guest sequences are those of the fusion peptides of influenza hemagglutinin, which are solubilized by a highly charged unstructured C-terminal host sequence. These peptides partition to the surface of negatively charged liposomes or erythrocytes and elicit membrane fusion or hemolysis. They undergo a conformational change from random coil to an obliquely inserted ( approximately 33 degrees from the surface) alpha-helix on binding to model membranes. Partition coefficients for membrane insertion were measured for influenza fusion peptides of increasing lengths (n = 8, 13, 16, and 20). The hydrophobic contribution to the free energy of binding of the 20-residue fusion peptide at pH 5.0 is -7.6 kcal/mol (1 cal = 4.18 J). This energy is sufficient to stabilize a "stalk" intermediate if a typical number of fusion peptides assemble at the site of membrane fusion. The fusion activity of the fusion peptides increases with each increment in length, and this increase strictly correlates with the hydrophobic binding energy and the angle of insertion.