In this paper we review the very large contribution made by RXTE to our understanding of Active Galaxies (AGN). We discuss the relationship between AGN and Galactic Black Hole X‐ray binary systems (GBHs) and show, by comparison of their powerspectral densities (PSDs) that some AGN are the equivalent of GBHs in their ‘high’ state, rather than in their ‘low’ state as has previously been assumed. We plot the timescale at which the PSD slope steepens from −1 to −2 against the black hole mass for a sample of AGN, and for Cyg X‐1 in its high and low states. We find it is not possible to fit all AGN to the same linear scaling of break timescale with black hole mass. However broad line AGN are consistent with a linear scaling of break timescale with mass from Cyg X‐1 in its low state and NLS1 galaxies scale better with Cyg X‐1 in its high state, although there is an exception, NGC3227. We suggest that the relationship between black hole mass and break timescale is a function of another underlying parameter which may be accretion rate or black hole spin or, probably, both. We examine X‐ray spectral variability and show how simple ‘flux‐flux’ plots can distinguish between ‘two‐component’ and ‘spectral pivoting’ models. We also examine the relationship between the X‐ray emission and that in other wavebands. In the case of X‐ray/optical variability we show how cooler discs in AGN with larger mass black holes lead to greater proximity of the X‐ray and optical emission regions and hence to more highly correlated variability. The very large amplitude of optical variability then rules out reprocessing as the origin of the optical emission. We show how the radio emission in NGC 4051 is strongly correlated with the X‐ray emission, implying some contribution to the X‐ray emission from a jet for which there is some evidence in radio images. We point out, however, that we have only studied in detail the X‐ray variability of a handful of AGN. There is a strong requirement to extend such studies to unbiased samples of many hundreds of AGN and so a strong need for a very sensitive (<mCrab in a day), long lived (∼10 years) all sky monitor. © 2004 American Institute of Physics