Protozoans of the genus Leishmania are obligate intracellular parasites that cycle between the midgut of sandflies and the phagolysosomes of mammalian macrophages and therefore are exposed to extreme environmental changes. Recent evidence obtained from in vitro experiments indicate that such environmental changes trigger a developmental program in the parasites. Thus, following heat shock, promastigotes from certain Leishmania species differentiate to amastigotes. Promastigotes also respond to acidification of their environment by changing the expression of a number of genes. However, the combination of both low pH and high temperature induces the transformation of the promastigote to the amastigote in all Leishmania species examined to date. This review discusses the role of pH and heat shock in gene regulation and its contribution to the differentiation processes in Leishmania spp. Cycling between cold-blooded insect vectors and the warm-blooded mammalian host is not unique to Leishmania spp., but typical to most parasitic protozoa. It is therefore likely that the mechanism of stress-induced differentiation is shared by other mammalian parasites.