Nostoc punctiforme is a phenotypically complex, filamentous, nitrogen-fixing cyanobacterium, whose vegetative cells can mature in four developmental directions. The particular developmental direction is determined by environmental signals. The vegetative cell cycle is maintained when nutrients are sufficient. Limitation for combined nitrogen induces the terminal differentiation of heterocysts, cells specialized for nitrogen fixation in an oxic environment. A number of unique regulatory events and genes have been identified and integrated into a working model of heterocyst differentiation. Phosphate limitation induces the transient differentiation of akinetes, spore-like cells resistant to cold and desiccation. A variety of environmental changes, both positive and negative for growth, induce the transient differentiation of hormogonia, motile filaments that function in dispersal. Initiation of the differentiation of heterocysts, akinetes and hormogonia are hypothesized to depart from the vegetative cell cycle, following separate and distinct events. N. punctiforme also forms nitrogen-fixing symbiotic associations; its plant partners influence the differentiation and behavior of hormogonia and heterocysts. N. punctiforme is genetically tractable and its genome sequence is nearly complete. Thus, the regulatory circuits of three cellular differentiation events and symbiotic interactions of N. punctiforme can be experimentally analyzed by functional genomics.