Although the macrophage colony stimulating factor (M-CSF) and its receptor, c-Fms, are involved in the survival and proliferation of hematopoietic cells, little is known about the signalling events leading to differentiation into mature blood cells. A 78 kDa Fms-interacting protein, FMIP, transiently binds to M-CSFactivated Fms-molecules. This binding results in a rapid phosphorylation of FMIP within its Fms-binding domain, thereby dissociating Fms and FMIP. Endogenous levels of FMIP may form a threshold that decide whether bipotential progenitor cells differentiate into macrophages or granulocytes. Myeloid progenitor cells express low levels of endogenous FMIP and, upon M-CSF specific signalling, are differentiated into macrophages. Overexpression of FMIP may saturate Fms, which results in predominant cytoplasmic expression of FMIP and favors granulocyte differentiation.