Stacking‐induced fluorescence increase (SIFI) was introduced recently as a method to probe DNA structure and dynamics using only a single fluorescent label. Here we show that the same DNA hairpin dynamics can be recovered, at the single‐molecule level, using either SIFI (with Cy3 as the label) or FRET (with Cy3 as donor and Cy5 as acceptor). We also measured FRET using a donor that cannot undergo SIFI, Cy3B, in the presence and absence of a molecular crowding agent (PEG). Although crowding increases hairpin hybridisation to the same extent with either Cy3 or Cy3B as the donor, the absolute rates are affected by the choice of donor dye. This work shows that SIFI can be used to measure single‐molecule dynamics, which could offer advantages over FRET in some cases. It also illustrates how local dye interactions can influence biomolecular dynamics, which should be considered when designing experiments.