Coagulation factor IX plays a central role in hemostasis through interaction with factor VIIIa to form the factor X-activating complex at the site of injury. The absence of factor IX activity results in the bleeding disorder hemophilia B. This absence of activity can arise either from a lack of circulating factor IX protein or from mutations that decrease the activity of factor IX. This review focuses on analyzing the structure of factor IX with respect to molecular mechanisms that are at the basis of factor IX function. Proteolytic activation of factor IX to activated factor IX(a) and subsequent structural rearrangements are insufficient to generate fully active factor IXa. Multiple specific interactions between factor IXa, the cofactor VIIIa, and physiological substrate factor X further alter the factor IXa structure to realize the full enzymatic activity of factor IXa. Factor IXa also interacts with inhibitors, extravascular proteins, and cellular receptors that clear factor IX(a) from circulation. Hemophilia B is treated by replacement of the missing factor IX by plasma-derived protein, a recombinant bioequivalent, or via gene therapy. An understanding of how the function of factor IX is tied to structure is leading to modified forms of factor IX that have increased residence time in circulation, higher functional activity, protection from inhibition, and even activity in the absence of factor VIIIa. These modified forms of factor IX have the potential to significantly improve therapy for patients with hemophilia B.