We investigated the impact of fluorescent labeling on the properties of a lipid bilayer using atomistic molecular dynamics simulation. The system consisted of 24 Texas Red-1,2-dihexadecanoyl-sn-glycero-3-phophoethanolamine (TR-DHPE) in a bilayer of 488 1,2-dipalmitoyl-sn-glycero-3-phosphocholine (DPPC) lipids. We found binding between TR-DHPE and DPPC caused by electrostatic interactions. On average, TR-DHPE is bound to 1.2 DPPC molecules. Binding reduced the diffusion coefficient of TR-DHPE by 34% relative to unlabeled DPPC molecules. We estimate that binding would lead to a ∼ 5 °C increase in the liquid to liquid-ordered transition temperature of a ternary lipid system. These results emphasize the importance of considering the impact of fluorescence labeling when interpreting experimental results.