In USA more than 12.5% of all infants are born preterm. Approximately 75% of all perinatal deaths occur among these preterm infants. Preterm infants are frequently very low in birth weight (VLBW) and receive multiple red blood cell (RBC) transfusions. These transfusions pose increased risk of infections and other complications. Since erythropoietin (EPO) stimulates RBC production, EPO treatment of VLBW infants has received attention as a modality for reducing transfusions in this group. The overall hypothesis of this work is that treatment optimization of EPO of anemia in preterm infants requires a comprehensive knowledge of the behavior of RBC and the pharmacokinetic/pharmacodynamics (PK/PD) relationship between EPO and erythropoiesis. Under that overall hypothesis, the specific aims were: 1) To describe erythropoiesis dynamics in preterm infants, 2) To determine and explain the variability in the response to EPO in preterm infants, 3) To evaluate newborn sheep as an experimental model for erythropoiesis in preterm infants, 4) To test the hypothesis that RBC lifespan is shortened under acute hypoxic stress conditions, 5) To test the hypothesis that EPO receptor (EPOR) pool size increases under hypoxic stress conditions and the change in EPOR pool size can be predicted using EPO clearance measurements, 6) To describe the effect of EPOR pool size changes on erythropoiesis kinetics. A model that describes erythropoiesis dynamics in preterm infants as a function of the plasma EPO concentration is presented in Chapter 2. In Chapter 3, several covariates are tested for their ability to identify infants with good EPO responsiveness. The lamb is also tested as an animal model for the erythropoiesis in preterm infants (Chapter 4). In Chapters 5-7, the effect of hypoxic stress conditions on RBC survival was explored defining the relation between the efficacy of EPO and survival of RBC produced as a result of EPO administration. RBC lifespan measurement methods are reviewed in Chapter 5. In Chapter 6, a new methodology for the measurement of RBC lifespan under stress conditions is developed. This new methodology is applied in Chapter 7 to explore the effect of hypoxic stress conditions on the survival of RBC. The study presented in Chapter 8 is undertaken to investigate changes in both EPOR pool size and EPO clearance under hypoxic conditions. An erythropoiesis model that accounts for change in the EPOR pool size under stress conditions is presented in Chapter 9. Analysis of erythropoiesis dynamics in preterm infants demonstrated that a three fold increase in the amount of RBC produced by preterm infants is possible by EPO administration. This emphasizes the potential of using EPO for the management of anemia in preterm infants. Covariate screening identified gestational age as a potential marker for the responsiveness to EPO treatment. PD analysis results in lambs demonstrated similarities between lambs and preterm infants in different erythropoietic characteristics such as sensitivity to EPO in producing RBC, Hb production rate before birth and blood volume. Survival analysis demonstrated that RBC lifespan is not shortened under acute hypoxic conditions Analysis of EPOR mRNA level demonstrated an up regulation of EPOR level under stress conditions accompanied by a parallel increase in EPO clearance. EPOR up regulation under stress conditions level was incorporated in a PD model presented in Chapter 9. The developed model provides a framework for optimizing EPO dosing. Accordingly, an optimal dosing strategy should in general maximize the interaction between EPO and EPOR. Specifically, EPO should be administered when the number of EPOR are close to maximally up-regulated.