Factor VIIa initiates the extrinsic coagulation cascade; this event requires a delicately balanced regulation that is implemented on different levels, including a sophisticated multi-step activation mechanism of factor VII. Its central role in hemostasis and thrombosis makes factor VIIa a key target of pharmaceutical research. We succeeded, for the first time, in recombinantly producing N-terminally truncated factor VII (rf7) in an Escherichia coli expression system by employing an oxidative, in vitro, folding protocol, which depends critically on the presence of ethylene glycol. Activated recombinant factor VIIa (rf7a) was crystallised in the presence of the reversible S1-site inhibitor benzamidine. Comparison of this 1.69A crystal structure with that of an inhibitor-free and sulphate-free, but isomorphous crystal form identified structural details of factor VIIa stimulation. The stabilisation of Asp189-Ser190 by benzamidine and the capping of the intermediate helix by a sulphate ion appear to be sufficient to mimic the disorder-order transition conferred by the cofactor tissue factor (TF) and the substrate factor X. Factor VIIa shares with the homologous factor IXa, but not factor Xa, a bell-shaped activity modulation dependent on ethylene glycol. The ethylene glycol-binding site of rf7a was identified in the vicinity of the 60 loop. Ethylene glycol binding induces a significant conformational rearrangement of the 60 loop. This region serves as a recognition site of the physiologic substrate, factor X, which is common to both factor VIIa and factor IXa. These results provide a mechanistic framework of substrate-assisted catalysis of both factor VIIa and factor IXa.