Rates of destruction of erythrocytes and of effective production of erythrocytes and hemoglobin have been determined in 10 patients with homozygous Cooley's anemia. The method employed was based upon survival of Cr51-labeled cells in patients in whom a state of equilibrium of erythrocytes was present. While a marked hemohytic defect is present, this defect does not, by itself, determine the degree of anemia present. Rates of effective production of erythrocytes are increased above normal but are not increased to the same degree found in patients with other hemolytic diseases. Rates of effective synthesis of hemoglobin were found to be less than those obtained for production of erythrocytes. The rates of production of fetal hemoglobin in these patients are remarkably elevated but cannot be directly correlated with the rate of destruction of erythrocytes, rate of production of erythrocytes, or the degree of anemia present. The hemolytic defect in patients with intermediate Cooley's anemia was comparable to that in the majority of the patients with the severe form of disease. However, the most marked hemolytic defects were among patients with the severe and not with the intermediate form of disease. Production of erythrocytes and hemoglobin did not differ significantly in the two forms of this disease. Results in two splenectomized patients did not differ significantly from results in the non-splenectomized group of patients. However, since pre-splenectomy data were not available, no statement may be made as to possible individual benefit derived from the operation. The final status of each patient is determined by the particular balance obtained between rates of destruction and production. Neither production nor destruction alone determines the degree of anemia. The compensation index, as a measure of final status in each patient, was lowest in the severe form of Cooley's anemia. It is presumed to be lower still in many patients who could not be studied because transfusion therapy was in progress. The compensation index is somewhat higher in patients with intermediate Cooley's anemia and in two splenectomized individuals not requiring frequent transfusions. Values in these patients approach the higher levels found in patients with sickle cell anemia and congenital spherocytosis.