Recent studies have shown that disruption of Notch1 signaling in lymphocyte progenitors (LP) inhibits T cell development and promotes B cell development in the thymus. Conversely, inappropriate activation of Notch1 in LP inhibits B cell development and causes ectopic T cell development in the bone marrow. These observations imply that Notch1 activation must be spatially regulated to ensure that LP generate B cells in the bone marrow and T cells in the thymus. However, Notch ligands are expressed in both tissues. Studies in flies and worms have revealed that Notch activation is extremely sensitive to small changes in the amount of receptor or ligand expressed, and defined multiple mechanisms that limit Notch activation to discrete cells at specific times during development. Here, we describe how some of these mechanisms might regulate Notch activity in LP during the T/B lineage decision.