Over 4000 putative proteorhodopsins (PRs) have been identified throughout the oceans and seas of the Earth. The first of these eubacterial rhodopsins was discovered in 2000 and has expanded the family of microbial proton pumps to all three domains of life. With photophysical properties similar to those of bacteriorhodopsin, an archaeal proton pump, PRs are also generating interest for their potential use in various photonic applications. We perform here the first reconstitution of the minimal photoactive PR structure into nanoscale phospholipid bilayers (nanodiscs) to better understand how protein-protein and protein-lipid interactions influence the photophysical properties of PR. Spectral (steady-state and time-resolved UV-visible spectroscopy) and physical (size-exclusion chromatography and electron microscopy) characterization of these complexes confirms the preparation of a photoactive PR monomer within nanodiscs. Specifically, when embedded within a nanodisc, monomeric PR exhibits a titratable pK(a) (6.5-7.1) and photocycle lifetime (∼100-200 ms) that are comparable to the detergent-solubilized protein. These ndPRs also produce a photoactive blue-shifted absorbance, centered at 377 or 416 nm, that indicates that protein-protein interactions from a PR oligomer are required for a fast photocycle. Moreover, we demonstrate how these model membrane systems allow modulation of the PR photocycle by variation of the discoidal diameter (i.e., 10 or 12 nm), bilayer thickness (i.e., 23 or 26.5 Å), and degree of saturation of the lipid acyl chain. Nanodiscs also offer a highly stable environment of relevance to potential device applications.