Human growth hormone (hGH) is a therapeutically important endocrine factor that signals various cell types. Structurally and functionally, the interactions of hGH with its receptor have been resolved in fine detail, such that hGH and hGH receptor variants can be practically engineered by either random or rational approaches to achieve significant changes in the free energies of binding. A somewhat unique feature of hGH action is its homodimerization of two hGH receptors, which is required for intracellular signaling and stimulation of cell proliferation, yet the potencies of hGH mutants in cell-based assays rarely correlate with their overall receptor-binding avidities. Here, a mathematical model of hGH-stimulated cell signaling is posed, accounting not only for binding interactions at the cell surface but induction of receptor endocytosis and downregulation as well. Receptor internalization affects ligand potency by imposing a limit on the lifetime of an active receptor complex, irrespective of ligand-receptor binding properties. The model thus explains, in quantitative terms, the numerous published observations regarding hGH receptor agonism and antagonism and challenges the interpretations of previous studies that have not considered receptor trafficking as a central regulatory mechanism in hGH signaling.