Association of peripheral proteins with lipid bilayers regulates membrane signaling and dynamics. Pleckstrin homology (PH) domains bind to phosphatidylinositol phosphate (PIP) molecules in membranes. The effects of local PIP enrichment on the interaction of PH domains with membranes is unclear. Molecular dynamics simulations allow estimation of the binding energy of GRP1 PH domain to PIP3-containing membranes. The free energy of interaction of the PH domain with more than two PIP3 molecules is comparable to experimental values, suggesting that PH domain binding involves local clustering of PIP molecules within membranes. We describe a mechanism of PH binding proceeding via an encounter state to two bound states which differ in the orientation of the protein relative to the membrane, these orientations depending on the local PIP concentration. These results suggest that nanoscale clustering of PIP molecules can control the strength and orientation of PH domain interaction in a concentration-dependent manner.