Coagulation reactions normally occur on cell membranes in vivo. Using a cell-based in vitro model system, we have shown that where a factor is located, not simply how much is activated, is critically important in determining its role in hemostasis. Factor Xa activated on a tissue factor (TF)-bearing cell is not equivalent to factor Xa activated on a platelet surface. Factor IX and factor VIII are required for hemostasis because they combine to generate factor Xa on the platelet surface. Factor X activation by factor VIIa/TF does not compensate for a lack of factor IX or VIII because the factor Xa activated by VIIa/TF is located on the wrong surface for efficient thrombin generation.