A recently developed technique for dilution of the naturally high protein packing density in isolated grana membranes was applied to study the dependence of the light harvesting efficiency of photosystem (PS) II on macromolecular crowding. Slight dilution of the protein packing from 80% area fraction to the value found in intact grana thylakoids (70%) leads to an improved functionality of PSII (increased antenna size, enhanced connectivity between reaction centers). Further dilution induces a functional disconnection of light-harvesting complex (LHC) II from PSII. It is concluded that efficient light harvesting by PSII requires an optimal protein packing density in grana membranes that is close to 70%. We hypothesize that the decreased efficiency in overcrowded isolated grana thylakoids is caused by excited state quenching in LHCII, which has previously been correlated with neoxanthin distortion. Resonance Raman spectroscopy confirms this increase in neoxanthin distortion in overcrowded grana as compared with intact thylakoids. Furthermore, analysis of the changes in the antenna size in highly diluted membranes indicates a lipid-induced dissociation of up to two trimeric LHCII from PSII, leaving one trimer connected. This observation supports a hierarchy of LHCII-binding sites on PSII.