Hematopoietic hormones/cytokines and receptors regulate a wide variety of biological activities and are important in medicine. Through recent biochemical, biophysical, and structural studies we are beginning to understand how these molecules work at the molecular level. These extracellular hormones activate their transmembrane receptors by causing them to oligomerize. The receptor oligomers in turn activate intracellular tyrosine kinase molecules which then activate transcription factors (the JAK-STAT pathways). This review centers on the molecular basis for hormone-receptor binding, and how this information is useful in understanding protein-protein interactions and for the design of second generation molecules.