Water is being considered as an economical, safe and environmental friendly alternative solvent for dye lasers. However, the use of water in dye laser is restricted due to the formation of non-emissive aggregates of dye molecules. In the present study we have explored the possibility of the use of commercially available surfactant molecules for the water based laser of Pyrromethene 597 (PM597) dye, which has emerged as an alternative for more commonly used Rhodamine dyes in dye laser systems. Our studies show that in water, PM597 forms non-emissive aggregates which can be dissociated into monomeric dye molecules by adding common surfactants. Further, the high microviscosity in the micellar media retarded energy wasting ring puckering process in the excited state of the dye leading to the increase in its emission yield and excited state lifetime to a significant extent. It has been demonstrated that the emission yield and excited state lifetime in surfactant solution is relatively higher than in ethanol, the most commonly used organic solvent for dye lasers. Lasing action has been demonstrated in the aqueous solution of dye and lasing efficiency is found to be comparable to ethanol.