This paper proposes to conceptualize the division of labor functionally,/nas a response to environmental variations and instabilities that lead to/nalternative forms of horizontal – task – and vertical – role –/ndifferentiation. Relying on contingency theory, the paper describes the/nmain sources and manifestations of these two forms of functional/ndifferentiation, and the alternative modes of integrating tasks and roles/nwithin structures that are more centralized, hierarchical, and formal as/nthe environment becomes more heterogeneous and unstable. The result/nof this exercise is a rich taxonomy of the division of labor with multiple/nand clear criteria intended for classifying occupations according to their/ntechnical characteristics.