The pathway controlling chemotaxis in Escherichia coli is the simplest and most well understood cell signalling system to date. However, quantitative models based on the available data still fail to reproduce important features of the pathway. Most notably, the observed sensitivity of cells to very small changes in stimulus concentrations cannot be reproduced by conventional models based on the measured concentrations, binding affinities and rate constants of the proteins involved. This discrepancy, together with recent experimental findings, drew our attention to the spatial organization of molecules within the cell and in particular to the clusters of receptors localised at the cell poles. A stochastic simulator for chemical reactions, STOCHSIM, was previously developed to model the chemotaxis pathway at the level of individual molecular interactions. This program has now been extended to incorporate a spatial representation that allows the interaction between molecules in a two-dimensional lattice to be simulated. In silico 'experiments' using this new version of STOCHSIM demonstrate that lateral interactions between clustered receptors can significantly enhance the excitation response. The adaptation reactions may also exploit the proximity of receptor molecules, and a hypothetical mechanism by which this may occur is currently being tested.