Nitric oxide (NO) regulates normal vasomotor tone and modulates important homeostatic functions such as thrombosis, cellular proliferation, and adhesion molecule expression. Recent data implicate a critical function for hemoglobin and the erythrocyte in regulating the bioavailability of NO in the vascular compartment. Under normoxic conditions the erythrocytic hemoglobin scavenges NO and produces a vasopressor effect that is limited by diffusional barriers along the endothelium and in the unstirred layer around the erythrocyte. In hemolytic diseases, intravascular hemolysis releases hemoglobin from the red blood cell into plasma (decompartmentalizes the hemoglobin), which is then able to scavenge endothelial derived NO 600-fold faster than erythrocytic hemoglobin, thereby dysregulating NO homoestasis. In addition to releasing plasma hemoglobin, the red cell contains arginase which when released into plasma further dysregulates arginine metabolism. These data support the existence of a novel mechanism of human disease, hemolysis associated endothelial dysfunction, that potentially participates in the vasculopathy of iatrogenic and hereditary hemolytic conditions. In addition to providing an NO scavenging role in the physiological regulation of NO-dependent vasodilation, hemoglobin and the erythrocyte may deliver NO as the hemoglobin deoxygenates. Two mechanisms have been proposed to explain this principle: 1) Oxygen linked allosteric delivery of S-nitrosothiols from S-nitrosated hemoglobin (SNO-Hb), and 2) a nitrite reductase activity of deoxygenated hemoglobin that reduces nitrite to NO and vasodilates the human circulation along the physiological oxygen gradient. The later newly described role of hemoglobin as a nitrite reductase is discussed in the context of hypoxic vasodilation, blood flow regulation and oxygen sensing.