The role of activated protein C (APC) in coagulation, inflammation, and fibrinolysis and the pharmacology, pharmacokinetics, and trials of recombinant human activated protein C (rhAPC), or drotrecogin alfa (activated), in sepsis are described. Protein C, a naturally occurring vitamin K-dependent serine protease in the blood, remains inactive until exposed to the thrombin-thrombomodulin complex. This change between the inactive and active forms occurs constantly in humans and serves to balance the coagulation cascade. APC functions in concert with protein S as an anticoagulant, a fibrinolytic agent, and an antiinflammatory agent. In response to serious infection, a procoagulant process is activated leading to thrombin and fibrin deposition in small vessels that results in decreased blood flow, decreased oxygen delivery, and organ failure. The body's natural defense during severe sepsis is to activate protein C through the thrombin-thrombomodulin complex in an attempt to restore the imbalance of the hemostatic systems. However, APC has a short half-life, and the pool of circulating protein C is rapidly depleted in severe sepsis. Low protein C levels have been correlated with poor outcome in patients with severe sepsis and in animal models. These observations led to a Phase III safety and efficacy trial of drotrecogin alfa (activated) that demonstrated a significant improvement in mortality compared with placebo (24.7% versus 30.8%). This 6.1% absolute difference in mortality translates to a 19.4% reduction in relative risk of death in the treated patients. The proper use of drotrecogin alfa (activated) will require careful consideration of appropriate patients to treat and further studies in patient populations that were excluded from the Phase III trial, as well as possible modification of dosing schemes on the basis of patient response.