A method for the study of conjugated polyelectrolyte (CPE) photophysics in solution at the single-molecule level is described. Extended observation times of single polymer molecules are enabled by the encapsulation of the CPEs within 200-nm lipid vesicles, which are in turn immobilized on a surface. When combined with a molecular-level visualization of vesicles and CPE via cryo-transmission electron microscopy, these single-molecule spectroscopy studies on CPEs enable us to directly correlate the polymer conformation with its spectroscopic features. These studies are conducted with poly[5-methoxy-2-(3-sulfopropoxy)-1,4-phenylene-vinylene] (MPS-PPV, a negatively charged CPE), when encapsulated in neutral and in negatively charged lipid vesicles. MPS-PPV exists as a freely diffusing polymer when confined in negatively charged vesicles. Individual MPS-PPV molecules adopt a collapsed-chain conformation leading to efficient energy migration over multiple chromophores. Both the presence of stepwise photobleaching in fluorescence intensity-time trajectories and emission from low-energy chromophores along the chain are observed. These results correlate with the amplified sensing potential reported for MPS-PPV in aqueous solution. When confined within neutral vesicles, single MPS-PPV molecules adopt an extended conformation upon insertion in the lipid bilayer. In this case emission arises from multiple chromophores within the isolated polymer chains, leading to an exponential decay of the intensity over time and a broad blue-shifted emission spectrum.