Protein G is a plasma, vitamin K‐dependent zymogen of a serine protease that can inhibit blood coagulation. Protein G is regulated by a series of reactions known as the protein G pathway. The importance of this pathway is seen in the occurrence of thrombosis in individuals with deficiencies in elements of the pathway like protein G and protein S. Work on several steps in this pathway has revealed that mechanisms involved in activation of protein G and the expression of its anticoagulant activity have features that allow for the expression of the anticoagulant activity away from sites in which procoagulant reactions occur, but not systemically. Thrombin, the principal procoagulant enzyme at the site of an injury, is converted to an anticoagulant enzyme at distant sites through its interaction with the endothelial cell protein thrombomodulin. Structural and functional studies have revealed the importance of several domain structures in the modulation of thrombin activity. Structural features of both activated protein C and its substrates (coagulation factors V and VIII) are such that they require the localization of enzyme and substrate on the surface of phosphtatidyl serine containing membranes for optimum activity.—Walker, F. J.; Fay, P. J. Regulation of blood coagulation by the protein C system. FASEB J. 6: 2561‐2567; 1992.