DNA-encoded library (DEL) technology is emerging as a key element of the small molecule discovery toolbox. DELs are highly diverse collections of combinatorially synthesized small molecules (~300-800 Da) attached to very large encoding DNA molecules. During affinity selection, the DNA tag can participate in the binding interaction, leading to false positive results and confounding the investigation of nucleic acid-binding targets (e.g. polymerases, transcription factors). An ideal affinity screen would only interrogate the library member for binding. Here, we use solid-phase DELs and microfluidic screening to separate each DEL member from its encoding tag and detect target binding using laser-induced fluorescence polarization (FP). DEL beads and an FP probe (dye-labeled ligand) are encapsulated in water-in-oil emulsion droplets containing the macromolecular target. Inside the droplet, the DEL member is photochemically cleaved from the DNA-encoded bead and laser-induced FP is measured. If the photocleaved library member competes with the probe for target binding, the probe emission is relatively depolarized, triggering electrokinetic droplet sorting and collection for follow up DNA sequencing. We prototyped this screening mode using the receptor tyrosine kinase (RTK) discoidin domain receptor 1 (DDR1), which is overexpressed in many cancers (e.g., leukemia, brain). A fluorescein-labeled DDR1 ligand (discovered in a previous affinity-based DEL screen) was used to build the droplet-scale competition binding assay. The FP signal difference between droplets containing either DDR1 or DDR1 and unlabeled competitor (20 µM) resulted in a Z’ of 0.58. After confirming assay robustness, a 67,100 member solid-phase DEL of drug-like small molecules was screened for ligands of DDR1 using the droplet-scale competition binding assay. Of the high-priority hit structures, several known RTK inhibitor pharmacophores were identified, including azaindole- and quinazoline-containing monomers. Off-DNA DEL affinity screening is amenable to screening in cell lysate and more complex affinity-based interrogations, such as interactome perturbation, in addition to providing an avenue to conduct mechanism-based screening using DEL.