Fusion of unilamellar phospholipid vesicles in the presence of proteins and cationic synthetic polypeptides was studied by monitoring the size increase and the mixing of the aqueous contents of the vesicle. It was found that synthetic polypeptides and the proteins known to form ``Molten-globular structure`` in acidic media, induced fusion of PS/PE at a molar ratio of 1:1 while other proteins had no effect. Bovine $\alpha$-lactalbumin, cytochrome c, lysozyme and ribonuclease are found to induce fusion of 1:1 mixture of vesicles containing of phosphotidylserine and phosphotidylethanolamine in the acidic pH. The increase in the initial rate of fusion correlates very well with the conformational change of the protein with decreasing pH from 7 to 2. The structural change of $\alpha$-lactalbumin in the presence of phospholipid vesicles as a function of pH was followed by using the fluorescence measurements. These phenomenons also parallel with the extent of molten globular structure formation and the extent of binding of $\alpha$-lactalbumin to the vesicles. These observations, taken together, suggests that the penetration of a hydrophobic segment of $\alpha$-lactalbumin into the hydrophobic interia of the model membrane causes the fusion of the vesicles. As the ionic strength is increased from 100 mM to 500 mM at pH3, the initial rate of fusion decreased but approached a certain value beyond the ionic strength of 400 mM, suggesting involvement of hydrophobic interactions in fusion mechanism.