It has been hypothesized that the protein C pathway is a pivotal link between the inflammation and coagulation cascades. The demonstration that a survival benefit is associated with administration of drotrecogin alfa (activated) (recombinant human activated protein C [APC]) in severe sepsis patients has provided new insights into the protein C pathway. APC was originally identified based on its antithrombotic properties, which result from the inhibition of activated Factors V and VIII. In the early 1990s, any potential anti-inflammatory properties of APC were thought to relate primarily to its inhibition of thrombin generation. However, the mid-1990s saw the identification of the endothelial protein C receptor (EPCR), which has subsequently been shown to be neither endothelial specific nor protein C specific, but has a primary function as a cofactor for enhancing the generation of APC or behaving as an APC receptor. Thus, the potential biologic activities of APC can be classed into two categories related either to the limiting of thrombin generation or to cellular effects initiated by binding to the EPCR. Intracellular signaling initiated by binding of APC to its receptor appears to be mediated by interaction with an adjacent protease-activated receptor (PAR), or by indirect activation of the sphingosine 1-phosphate pathway. Based mostly on in vitro studies, binding of APC to its receptor on endothelial cells leads to a decrease in thrombin-induced endothelial permeability injury, while such binding on blood cells, epithelial cells, and neurons has been shown to inhibit chemotaxis, be anti-apoptotic, and be neuroprotective, respectively. In the Recombinant Human Activated Protein C Worldwide Evaluation in Severe Sepsis (PROWESS) study, drotrecogin alfa (activated) was associated with improved cardiovascular function, respiratory function, and a prevention of hematologic dysfunction. This article discusses the way in which the interactions of APC may alter the microcirculation.