The number of circulating red cells is regulated by the daily balance between two processes: the destruction of the old red cells in the liver and the generation of new cells in the bone marrow. The process during which hematopoietic stem cells generate new red cells is called erythropoiesis. This article describes the most recent advances in molecular and cellular biology which have allowed the identification of the molecular mechanisms involved in the process of erythroid differentiation. It reviews the cellular compartments involved in the process, what is known on how these cells respond to erythroid specific growth factors and how the cells progressively activate specific transcription factors in order to express genes involved in the establishment of the erythroid phenotype.