Hydrophobic interaction of 8-anilino-1-naphthalene sulfonic acid (ANS) with proteins is one of the widely used methods for characterizing/detecting partially folded states of proteins. We have carried out a systematic investigation on the effect of ANS, a charged hydrophobic fluorescent dye, on structural properties of acid-unfolded horse heart cytochrome c at pH 2.0 by a combination of optical methods and electrospray ionization mass spectroscopy (ESI MS). ANS was found to induce, a secondary structure similar to native protein and quenching of fluorescence of tryptophan residue, in the acid-unfolded protein. However, the tertiary structure was found to be disrupted thus indicating that ANS stabilizes a molten globule state in acid-unfolded protein. To understand the mechanism of ANS-induced folding of acid-unfolded cytochrome c, comparative ESI MS, soret absorption, and tryptophan fluorescence studies using nile red, a neutral hydrophobic dye, and ANS were carried out. These studies suggested that, at low pH, electrostatic interactions between negatively charged ANS molecules and positively charged amino acid residues present in acid-unfolded cytochrome c are probably responsible for ANS-induced folding of acid-unfolded protein to partially folded compact state or molten globule state. This is the first experimental demonstration of ANS induced folding of unfolded protein and puts to question the usefulness of ANS for characterization/determination of partially folded intermediates of proteins observed under low pH conditions.