Envelop is a verb. Envelope is a noun. Both words come form the Old French envoluper, but they came to English separately and have never been interchangeable. Even so, due to their obvious similarities in spelling, the two words are often used in place of each other.
The noun, envelope, is pronounced both in the French style (ahn-vuhlope) and in the Anglicized style (ehn-vuhlope).
Examples
These writers correctly use envelop as a verb:
The shimmering zinc scales that envelop it echo the greasy grey skies above and the silver stretch of now quiet water. [Financial Times]
After the tour, we decided to start our one-mile climb up the mountain despite the heavy mist enveloping everything. [Washington Post]
When the downpour ends, thick and eerily swirling low cloud envelops me. [The Australian]
And these writers use the noun correctly:
Her envelope had hearts where the o‘s in my name should have been and I tore it open and read her letter right there in the sun. [excerpted in NPR]
Yes, look twice, and your iPad case could do double-duty as a chic envelope-style bag. [Vancouver Sun (article now offline)]
Mitchell believes balcony gardening is all about being realistic about what you can achieve – but then pushing at the seed envelope. [Telegraph]
