The interaction of thrombin with protein C triggers a key down-regulatory process of the coagulation cascade. Using a panel of 77 Ala mutants, we have mapped the epitope of thrombin recognizing protein C in the absence or presence of the cofactor thrombomodulin. Residues around the Na(+) site (Thr-172, Lys-224, Tyr-225, and Gly-226), the aryl binding site (Tyr-60a), the primary specificity pocket (Asp-189), and the oxyanion hole (Gly-193) hold most of the favorable contributions to protein C recognition by thrombin, whereas a patch of residues in the 30-loop (Arg-35 and Pro-37) and 60-loop (Phe-60h) regions produces unfavorable contributions to binding. The shape of the epitope changes drastically in the presence of thrombomodulin. The unfavorable contributions to binding disappear and the number of residues promoting the thrombin-protein C interaction is reduced to Tyr-60a and Asp-189. Kinetic studies of protein C activation as a function of temperature reveal that thrombomodulin increases >1,000-fold the rate of diffusion of protein C into the thrombin active site and lowers the activation barrier for this process by 4 kcal/mol. We propose that the mechanism of thrombomodulin action is to kinetically facilitate the productive encounter of thrombin and protein C and to allosterically change the conformation of the activation peptide of protein C for optimal presentation to the thrombin active site.