The activity of the coagulation system is regulated, in part, by the interaction of thrombin with the endothelial cell receptor thrombomodulin with subsequent generation of activated protein C and suppression of thrombin production. Our previous investigation demonstrated that ablation of the thrombomodulin gene in mice causes embryonic lethality before the assembly of a functional cardiovascular system, indicating a critical role for the receptor in early development. In the current study, we show that a single amino acid substitution in thrombomodulin dissociates the developmental function of the receptor from its role as a regulator of blood coagulation. Homozygous mutant mice with severely reduced capacity to generate activated protein C or inhibit thrombin develop to term, and possess normal reproductive performance. The above animals exhibit increased fibrin deposition in selected organs, which implies tissue specific regulation of the coagulation system that is supported by further evidence from the examination of mice with defects in fibrinolysis. The thrombomodulin-deficient animals provide a murine model to examine known or identify unknown genetic and environmental factors that lead to the development of thrombosis.