A new 2-phenyl-4-[4-(1,4,7,10-tetraoxa-13-azacyclopentadecyl)benzylidene]-5-oxazolone (CPO) derivative was utilized to develop an optical acetylcholinesterase (AChE) biosensor in which the azlactone derivative was embedded in plasticized polyvinylchloride (PVC) matrix. The sensor system was calibrated for the detection of acetylcholine (ACh) and donepezil which is a competitive cholinesterase (ChE) inhibitor. Two different biosensing systems were developed by using AChE enzyme in solution and immobilized together with the fluorescent derivative (CPO) doped in transparent PVC membrane. The enzymatic hydrolysis of ACh was monitored by following changes in the pH induced fluorescence intensity. When AChE enzyme was immobilized in PVC matrix together with CPO, the sensitivity of the measuring system has increased approximately three times for ACh, in comparison to the sensing system where AChE enzyme was in solution phase.