In this contribution, the structural and dynamic changes occurring to papain in ethanol-water binary solvent mixtures have been investigated and compared with its denatured state. Steady-state fluorescence, solvation dynamics, time-resolved rotational anisotropy, circular dichroism (CD), and single molecular-level fluorescence correlation spectroscopic (FCS) studies were performed for this purpose. In ethanol-water mixtures with XEtOH = 0.6, N-(7-dimethylamino-4-methylcoumarin-3-yl)iodoacetamide (DACIA)-tagged papain was found to undergo a blue shift of 12 nm, while in the presence of 5 M GnHCl, a red shift of 5 nm was observed. Solvation dynamics of the system was also found to be different in the presence of these external agents. In ethanol-water mixtures, the average solvation time was found to increase almost 2-fold as compared to that in water, while in the presence of GnHCl, only a marginal increase could be observed. These changes of DACIA-tagged papain in ethanol-water mixtures are attributed to the aggregation of the protein in the presence of ethanol. The residual anisotropy was found to increase 14-fold, and the rotational time component corresponding to the rotation of the probe molecule was found to increase by 4-fold in the ethanol-water mixture which also gives a notion of the papain aggregation. Atomic force microscopy (AFM) confirms this aggregate formation, which is also quantified by the FCS study. The hydrodynamic radius of the protein aggregates in ethanol-water mixtures was calculated to be ∼155 Å as compared to the corresponding value of 18.4 Å in the case of native monomer papain. Also, it confirmed that the aggregate formation takes place even in the nanomolar concentration of papain. Analysis of circular dichroism spectra of papain showed that an increase in the β-sheet content of papain at the expense of α-helix and the random coil with an increase of the ethanol mole fraction may be responsible for this aggregation process.