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Proteolytic enzymes in the gut represent one of the biggest barriers against oral delivery of therapeutic proteins and peptides. In the current study, we explored the effect of poly(ethylene glycol) 400 (PEG 400), a commonly used crowding agent, on insulin degradation mediated by α-chymotrypsin (α-CT). Without PEG 400, insulin was quickly cleaved by α-CT to generate inactive degradation products. In comparison, incorporation of PEG 400 resulted in reaction mixtures with retained biological activity. The analysis on the conformation of α-CT and the local environment of the enzyme's active site unraveled that PEG 400 altered the conformation of α-CT to prevent the inactivation of insulin via stabilization of active intermediates. These findings indicated that PEG 400 may provide a promising addition toward oral delivery of insulin.