We propose a mathematical model for prey–predator interactions allowing prey refuge. A prey–predator model is considered in the present investigation with the inclusion of Holling type-II response function incorporating a prey refuge depending on both prey and predator species. We have analyzed the system for different interesting dynamical behaviors, such as, persistent, permanent, uniform boundedness, existence, feasibility of equilibria and their stability. The ranges of the significant parameters under which the system admits a Hopf bifurcation are investigated. The system exhibits Hopf-bifurcation around the unique interior equilibrium point of the system. The explicit formula for determining the stability, direction and periodicity of bifurcating periodic solutions are also derived with the use of both the normal form and the center manifold theory. The theoretical findings of this study are substantially validated by enough numerical simulations. The ecological implications of the obtained results are discussed as well.