We describe an efficient solvation model for proteins. In this model atomic solvation parameters imitating the hydrocarbon core of a membrane, water, and weak polar solvent (octanol) were developed. An optimal number of solvation parameters was chosen based on analysis of atomic hydrophobicities and fitting experimental free energies of gas-cyclohexane, gas-water, and octanol-water transfer for amino acids. The solvation energy term incorporated into the ECEPP/2 potential energy function was tested in Monte Carlo simulations of a number of small peptides with known energies of bilayer-water and octanol-water transfer. The calculated properties were shown to agree reasonably well with the experimental data. Furthermore, the solvation model was used to assess membrane-promoting α-helix formation. To accomplish this, all-atom models of 20-residue homopolypeptides - poly-Leu, poly-Val, poly-Ile, and poly-Gly in initial random coil conformation - were subjected to nonrestrained Monte Carlo conformational search in vacuo and with the solvation terms mimicking the water and hydrophobic parts of the bilayer. All the peptides demonstrated their largest helix-forming tendencies in a nonpolar environment, where the lowest-energy conformers of poly-Leu, Val, Ile revealed 100, 95, and 80% of α-helical content, respectively. Energetic and conformational properties of Gly in all environments were shown to be different from those observed for residues with hydrophobic side chains. Applications of the solvation model to simulations of peptides and proteins in the presence of membrane, along with limitations of the approach, are discussed.