One of the fundamental benefits of the 10BASE-T physical interface for 802.3/Ethernet is that the health of the communications link can be permanently monitored. When in the "link good" condition, the 10BASE-T transceiver is required to output a link status (LNKST) signal to this effect. Media Access Controller (MAC) 30, with an embedded 10BASE-T transceiver (37), uses the LNKST signal to provide power management to the MAC (30). By using the programmable AWAKE bit, the receive section of the 10BASE-T transceiver (37) can remain powered, even if the SLEEP input to the MAC (30) is activated. This allows the transceiver (37) to detect a link beat pulse (60) or receive packet activity. If either receive condition is encountered, the internal transceiver (37) will activate the LNKST output from the MAC (30). The system hardware and/or software can use the LNKST output to take appropriate action. For instance, if the LNKST output is active (low), then the computer is connected to an active network, and it is likely that the operating system will allow the MAC (30) to remain powered. However, if the LNKST becomes inactive (high) then the system can assume that the link is inactive, and the MAC can be powered down to save power. If at a later time the link is re-established, the MAC (30) can be powered back up to take advantage of the communications channel. In this way, the power consumption of the Ethernet connection can be managed by the operating software/hardware.