Hemostasis is a crucial component of vascular homeostasis that prevents blood loss while also maintaining vascular patency. Hemostasis is achieved, in part, through a cascade of serine proteases that are sequentially activated, culminating in formation of the effector protease, thrombin. Normally, this process is tightly regulated, but loss of regulation can lead to bleeding or excessive clot formation (thrombosis). In the event of thrombosis, anticoagulation is the mainstay of care. Numerous pharmacokinetic problems with the oral anticoagulant warfarin prompted the development of new oral agents that directly inhibit the serine proteases of coagulation. In particular, several active site inhibitors of coagulation factor Xa (FXa) have recently been approved and are at least as effective as warfarin for the prevention of thrombosis. However, they, like warfarin, increase the risk of bleeding, and there are no approved countermeasures to treat or prevent bleeding with these direct FXa inhibitors. We evaluated whether a variant of FXa (FXaI[16]L) could reverse the effects of the direct FXa inhibitor rivaroxaban. FXaI[16]L has poor active site function and a long plasma half-life but has high catalytic activity at the site of vascular injury, making it an effective pro-hemostatic agent. FXaI[16]L potently reversed the effects of rivaroxaban in in vitro studies and animal models of coagulation. Kinetic studies revealed that both FXaI[16]L and wt-FXa are highly inhibited by rivaroxaban at therapeutic concentrations when bound to the cofactor FVa. Despite this high level of inhibition with rivaroxaban, both FXaI[16]L and wt-FXa support thrombin generation. To explain this discrepancy, we measured the kinetics of FXa inhibition by antithrombin III (ATIII), a key regulator of FXa activity in plasma. Rivaroxaban impaired ATIII-dependent FXa inhibition by creating a pool of reversibly-inhibited FXa, and kinetic simulations indicated that, under these conditions, a steady-state of free, uninhibited FXa is established. Thus, there is a paradoxical increase in the level of free FXa which explains how FXaI[16]L can generate thrombin in the presence of rivaroxaban. These results reveal a previously unreported, unintended consequence of direct FXa inhibitors that may have important implications. Further, FXaI[16]L may be able to fill the unmet clinical need for a rapid, hemostatic reversal agent for these new anticoagulants.