The dynamic lateral segregation of signaling proteins into microdomains is proposed to facilitate signal transduction, but the constraints on microdomain size, mobility, and diffusion that might realize this function are undefined. Here we interrogate a stochastic spatial model of the plasma membrane to determine how microdomains affect protein dynamics. Taking lipid rafts as representative microdomains, we show that reduced protein mobility in rafts segregates dynamically partitioning proteins, but the equilibrium concentration is largely independent of raft size and mobility. Rafts weakly impede small-scale protein diffusion but more strongly impede long-range protein mobility. The long-range mobility of raft-partitioning and raft-excluded proteins, however, is reduced to a similar extent. Dynamic partitioning into rafts increases specific interprotein collision rates, but to maximize this critical, biologically relevant function, rafts must be small (diameter, 6 to 14 nm) and mobile. Intermolecular collisions can also be favored by the selective capture and exclusion of proteins by rafts, although this mechanism is generally less efficient than simple dynamic partitioning. Generalizing these results, we conclude that microdomains can readily operate as protein concentrators or isolators but there appear to be significant constraints on size and mobility if microdomains are also required to function as reaction chambers that facilitate nanoscale protein-protein interactions. These results may have significant implications for the many signaling cascades that are scaffolded or assembled in plasma membrane microdomains.