RATIONALE Hemolysis occurs in conditions such as sickle cell disease and malaria but also during transfusion of stored blood, extracorporeal circulation and sepsis. Cell-free hemoglobin (Hb) depletes nitric oxide (NO) in the vasculature, causing vasoconstriction and eventually cardiovascular complications. We hypothesize that Hb-binding proteins may preserve vascular NO signaling during hemolysis. OBJECTIVES Characterization of an archetypical function by which Hb scavenger proteins could preserve NO signaling during hemolysis. METHODS We investigated NO reactions kinetics, effects on arterial NO signaling and tissue distribution of cell-free Hb and its scavenger protein complexes. MEASUREMENTS AND MAIN RESULTS Extravascular translocation of cell-free Hb into interstitial spaces, including the vascular smooth muscle cell layer of rat and pig coronary arteries, promotes vascular NO resistance. This critical disease process is blocked by haptoglobin. Haptoglobin does not change NO dioxygenation rates of Hb; rather, the large size of the Hb:haptoglobin complex prevents Hb extravasation, which uncouples NO/Hb interaction and vasoconstriction. Size-selective compartmentalization of Hb functions as a substitute for RBCs following hemolysis and preserves NO signaling in the vasculature. We found that evolutionarily and structurally unrelated Hb binding proteins, such as PIT54 found in avian species, functionally converged with haptoglobin to protect NO signaling by sequestering cell-free Hb in large protein complexes. CONCLUSIONS Sequential compartmentalization of Hb by erythrocytes and scavenger protein complexes is an archetypical mechanism, which may have supported co-evolution of hemolysis and normal vascular function. Therapeutic supplementation of Hb scavengers may restore vascular NO signaling and attenuate disease complications in patients with hemolysis.