Many life-sustaining activities in living cells occur at the membrane-water interface. The pertinent questions that we need to ask are, what are the evolutionary reasons in biology for choosing the membrane-water interface as the site for performing and/or controlling crucial biological reactions, and what is the key physical principle that is very singular to the membrane-water interface that biology exploits for regulating metabolic processes in cells? In this chapter, a hypothesis is developed, which espouses that cells control activities of membrane-bound enzymes through manipulation of the thermodynamic activity of water in the lipid-water interfacial region. The hypothesis is based on the fact that the surface pressure of a lipid monolayer is a direct measure of the thermodynamic activity of water at the lipid-water interface. Accordingly, the surface pressure-dependent activation or inactivation of interfacial enzymes is directly related to changes in the thermodynamic activity of interfacial water. Extension of this argument suggests that cells may manipulate conformations (and activities) of membrane-bound enzymes by manipulating the (re)activity of interfacial water at various locations in the membrane by localized compression or expansion of the interface. In this respect, cells may use the membrane-bound hormone receptors, lipid phase transition, and local variations in membrane lipid composition as effectors of local compression and/or expansion of membrane, and thereby local water activity. Several experimental data in the literature will be reexamined in the light of this hypothesis.