Vascular smooth muscle cells (VSMCs) play a key role in regulating the circulation of blood in the vasculature by providing vascular wall structural integrity and regulating arterial tone and systemic blood pressure. Numerous stress factors including inflammation and mechanical stress induce loss of the contractile VSMC phenotype and stimulate their migration and proliferation. This can lead to impaired vascular function and is associated with high cardiovascular mortality and morbidity. We recently showed that VSMCs secrete exosomes which form the nidus for calcification (Kapustin et al., Circ Res, 2015). Notably, we found that exosome release is a unique feature of actively proliferating VSMCs undergoing phenotypic conversion. Treatment of the cells with pro-inflammatory PDGF-BB or TNF-alpha in vitro enhanced exosome secretion and this was mediated by up-regulation of sphingomyelin phosphodiesterase 3, an enzyme generating ceramide and thereby driving exosome budding into multivesicular bodies. These data are consistent with the high abundance of exosomes in the pro-inflammatory environment in atherosclerotic plaque in vivo. Rupture of the fibrous cap in atherosclerotic lesions is often associated with thrombus formation in the vascular lumen which is caused by exposure of coagulation factor binding sites, namely phosphatidylserine (PS), on the surface of apoptotic cells. We have also identified PS on VSMC-derived exosomes suggesting that exosomes can stimulate coagulation. Addition of VSMC exosomes to normal plasma stimulated thrombin generation in vitro whilst annexin A5, proposed to play a role in the inhibition of blood coagulation, abrogated this effect indicating that it is mediated by PS exposed on exosomes. We found that coagulation factor II, prothrombin (PT) is uptaken by VSMCs and loaded onto the exosome surface. Unexpectedly, PT recycled in exosomes was not susceptible for conversion to thrombin by prothrombinase complex and the blocking of PS sites by inactive PT reduced exosome thrombotic activity. Further studies showed that exosomes are enriched with specific thrombin inhibitors, alpha-macroglobulin and protease nexin-1 which inhibit activation of PT and reduce exosome pro-coagulant activities. Together our data shows that exosome secretion by VSMCs is associated with phenotypic VSMCs transdifferentiation in the pro-inflammatory milieu in the vascular wall. Secreted exosomes can contribute to thrombus formation by providing exposed PS. However, VSMC load exosomes with PS-binding proteins, annexins and PT as well as thrombin inhibitors thus counteracting their pro-coagulant activity.