TF mediated initiation of coagulation appears to play a critical role in normal hemostasis and probably pathologic thrombosis as well. Although teleological considerations would seem to suggest that a specific regulator of this process should exist, and although the presence in plasma of such an inhibitor was documented many years ago, it was not until the past five years that the inhibitor was characterized and its mechanism of action defined. LACI produces factor Xa-dependent feedback initiation of the VIIa/TF catalytic complex. The mechanism of this feedback inhibition is novel. First, LACI, a multi-headed protease inhibitor, binds factor Xa, a product of VIIa/TF catalysis, at one of its inhibitory domains. The Xa-LACI complex, possibly acting as a pseudosubstrate, then is able to bind to VIIa/TF in an appropriate conformation such that a second inhibitory domain of LACI is positioned to interact with factor VIIa in the VIIa/TF complex. Whether such a unique means of eliciting feedback inhibition in a protease cascade is repeated in nature is unknown. The existence of LACI appears to help explain the clinical need for both "extrinsic" and "intrinsic" coagulation pathways. In addition, data to the present are consistent with the notion that, in normal hemostasis at least, TF is responsible for an initial burst of factor Xa generation which provides sufficient thrombin to induce the aggregation of platelets and the activation of the critical coagulation cofactors factor V and factor VIII. Ultimate and persistent hemostasis, however, appears to require the continued production of additional factor Xa through the action of factor IXa and factor VIII. The fact that patients with factor XI deficiency suffers a variable but usually mild bleeding diathesis suggests that under certain conditions the initial burst of factor IXa formed through the action of VIIa/TF is insufficient and supplemental factor IXa generated by factor XIa is needed for normal hemostasis. The mechanism by which this factor XIa is generated in vivo, however, has not been determined. We stress that the predicted in vivo role of LACI is simply that--a prediction based on its known in vitro properties. Documentation of its physiologic importance remains to be provided and is an area of active research. Further, although significant progress has been made over the past few years in the characterization of LACI, many questions remain unanswered. For example: What is the mechanism for LACI's association with lipoproteins in plasma? What function, if any, does the third Kunitz-type protease inhibitor domain in LACI serve? (ABSTRACT TRUNCATED AT 400 WORDS)