The mobile receptor hypothesis has been proposed to describe the process by which hormone receptor binding initiates a biological response; it states that receptors, which can diffuse independently in the plane of the membrane, reversibly associate with effectors to regulate their activity. The affinity for effector is greater when the receptor is occupied by hormone. A mathematical expression of the mobile receptor hypothesis is used to show that: (1) The predicted kinetics of hormone receptor binding may be indistinguishable from "negative cooperativity." (2) Receptor occupancy and biological response may be coupled in a non-linear fashion. By choosing specific parameters, most of the existing data on insulin binding and biological responses can be explained in terms of the mobile receptor hypothesis. Thus, the following are easily explained: (1) A single homogeneous receptor may appear kinetically to be composed of two classes (of high and low affinity) of receptors. (2) Occupancy of the apparent class of high affinity receptors is related linearly to the biological response. (3) The same receptor in different tissues may appear to have different affinity. (4) The binding of different biologically active insulin analogues may exhibit different degrees of "cooperativity." These considerations may also be pertinent to interpretations of other hormone-receptor systems and of various ligand-macromolecule interactions.