A protein model with the pairwise interaction energies varying as the local
environment changes, i.e., including some kind of collective effect betwee
n the contacts, is proposed. Lattice Monte Carlo simulations on the thermod
ynamical characteristics and free energy profile show a well-defined two-st
ate behavior and cooperativity of folding for such a model. As a comparison
, related simulations for the usual G (o) over bar model, where the interac
tion energies are independent of the local conformation, are also made. Our
results indicate that the evolution of interactions during the folding pro
cess plays an important role in the two-state cooperativity in protein fold
ing.