Antibody discovery technologies, essential for research and therapeutic applications, have evolved significantly since the development of hybridoma technology. Various in vitro (display) and in vivo (animal immunization and B cell-sequencing) workflows have led to the discovery of antibodies against diverse antigens. Despite this success, standard display and B-cell sequencing-based technologies are limited to targets that can be produced in a soluble form. This limitation inhibits the screening of function-inducing antibodies, which require the target to be expressed in cells to monitor function or signaling, and antibodies targeting proteins that maintain their physiological structure only when expressed on cell membranes, such as G-protein coupled receptors (GPCRs). A high-throughput two-cell screening workflow, which localizes an antibody-secreting cell (ASC) and a cell expressing the target protein in a microenvironment, can overcome these challenges. To make function-first plasma cell-based antibody discovery accessible and scalable, we developed hydrogel Nanovials that can capture single plasma cells, target-expressing cells, and plasma cell secretions (antibodies). The detection and isolation of Nanovials harboring the antigen-specific plasma cells are then carried out using a flow cytometry cell sorter - an instrument that is available in most academic centers and biopharmaceutical companies. The antibody discovery workflow employing Nanovials was first validated in the context of two different cell membrane-associated antigens produced in recombinant form. We analyzed over 40,000 plasma cells over two campaigns and were able to identify a diversity of binders that i) exhibited high affinity (picomolar) binding, ii) targeted multiple non-overlapping epitopes and iii) demonstrated high developability scores. A campaign using the two-cell assay targeting the immune checkpoint membrane protein PD-1 yielded cell binders with similar EC50s to clinically used Pembrolizumab and Nivolumab. The highest selectivity for binders was observed for sorted events corresponding with the highest signal bound to target cells on Nanovials. Overall, Nanovials can provide a strong foundation for function-first antibody discovery, yielding direct cell binding information and quantitative data on prioritization of hits with flexibility for additional functional readouts in the future.