We have proposed previously that the steps in coagulation most sensitive to inhibition by heparin are the thrombin-dependent amplification reactions, and that prothrombinase is formed in heparinized plasma only after Factor Xa activates Factor VIII and Factor V. These propositions were based on the demonstration that both heparin and Phe-Pro-Arg-CH2Cl completely inhibited 125I-prothrombin activation for up to 60 s when contact-activated plasma (CAP) was replenished with Ca2+. Furthermore, the addition of thrombin to CAP before heparin or Phe-Pro-Arg-CH2Cl completely reversed their inhibitory effects. Additional support for the above hypotheses is provided in this study by demonstrating that, when the activity of thrombin is suppressed by heparin (indirectly) or by Phe-Pro-Arg-CH2Cl (directly), exogenous Factor Xa reverses the ability of these two agents to inhibit prothrombin activation. Prothrombin activation was initiated by adding Factor Xa (1 nM) or thrombin (1 or 10 nM) simultaneously with CaCl2 to CAP. In the absence of heparin or Phe-Pro-Arg-CH2Cl, prothrombin activation was seen 15 s later in either case. Heparin failed to delay, and Phe-Pro-Arg-CH2Cl delayed for 15 s, prothrombin activation in CAP supplemented with Factor Xa. In contrast, heparin and Phe-Pro-Arg-CH2Cl completely inhibited prothrombin activation for at least 45 s in CAP supplemented with 1 nM-thrombin. Heparin failed to delay prothrombin activation in CAP supplemented with 10 nM-thrombin, whereas Phe-Pro-Arg-CH2Cl completely inhibited prothrombin activation in this plasma for 45 s. These results suggest that in CAP: (1) Factor Xa can effectively activate Factor VIII and Factor V when the proteolytic activity of thrombin is suppressed; (2) heparin-antithrombin III is less able to inhibit Factor Xa than thrombin; (3) suppression of the thrombin-dependent amplification reactions is the primary anticoagulant effect of heparin.