<p>Microdroplet encapsulation of cells is a powerful tool for high-throughput biological testing. The technique is widely used in mutant selection and strain engineering, where strict compartmentalization is often required to prevent transfer of cells or molecules between droplets. While molecular transfer has been reported for fluorophores, the potential transfer of common small substrates and products, and its impact on biological outcomes, has not been elucidated. Here, using a biosensor system, we demonstrate that biologically relevant molecules such as small alcohols (e.g. ethanol) and weak acids can transfer between droplets. The transfer can alter carbon availability and pH in neighboring droplets. Ethanol, a common product in biological systems, partitions directly into the oil phase, leading to unintended cell growth in adjacent droplets. Weak acids also transfer, decreasing the pH in neighboring droplets. Our results show that the transfer of small, hydrophobic molecules, commonly found in biological systems, can significantly alter experimental outcome. These findings highlight the need for validating droplet compartmentalization in assays involving small, amphiphilic molecules and careful selection of substrates that are not likely to transfer among droplets.</p>