An increasing understanding of the process of erythropoiesis raises some interesting questions about the pathophysiology, diagnosis and treatment of anemia and erythrocytosis. The mechanisms underlying the development of many of the erythrocytoses, previously characterised as idiopathic, have been elucidated leading to an increased understanding of oxygen homeostasis. Characterisation of anemia and erythrocytosis in relation to serum erythropoietin levels can be a useful addition to clinical diagnostic criteria and provide a rationale for treatment with erythropoiesis stimulating agents (ESAs). Recombinant human erythropoietin as well as other ESAs are now widely used to treat anemias associated with a range of conditions, including chronic kidney disease, chronic inflammatory disorders and cancer. There is also heightened awareness of the potential abuse of ESAs to boost athletic performance in competitive sport. The discovery of erythropoietin receptors outside of the erythropoietic compartment may herald future applications for ESAs in the management of neurological and cardiac diseases. The current controversy concerning optimal hemoglobin levels in chronic kidney disease patients treated with ESAs and the potential negative clinical outcomes of ESA treatment in cancer reinforces the need for cautious evaluation of the pleiotropic effects of ESAs in non-erythroid tissues.