The potential of ionic liquids as a green alternative to environmentally harmful volatile organic solvents has been well recognized. Being considered as "designer solvents", ionic liquids have been used extensively in a wide range of applications including biotransformations. As compared to those in traditional organic solvents, enzyme performance in ionic liquids is showed enhance in their activity, enantioselectivity, stability, as well as their recoverability and recyclability. This chapter will cover the biocompatibility issue of ionic liquids with enzymes. The effects of ionic liquid properties on the enzymatic reactions and conformation of enzyme as well as methods for activation and stabilization of enzymes in ionic liquids will be described. In addition, the current attempts for rational design of biocompatible ionic liquids will be also discussed.