A method is selects membrane-translocating peptides (MTPs) from a peptide display library that are capable of crossing or penetrating a lipid membrane. A plurality of nucleic acid constructs that encode displayed peptides are expressed, resulting in the formation of a plurality of nucleic acid-peptide complexes, each complex comprising at least one displayed peptide associated with the corresponding nucleic acid construct encoding the displayed peptide; the complexes are exposed to a population of membrane-encapsulated compartments, allowing a translocating reaction to occur; complexes that remain unassociated with the membrane are removed; optionally complexes that are associated with the membrane are removed; and internalized nucleic acid-peptide complexes are recovered. The membrane-encapsulated compartments may be artificial vesicles such as liposomes, or populations of one or more cell types.