Using photoionization models applied to the data from the Sloan Digital Sky Survey (SDSS) we propose a physically motivated dividing line in the [OIII]/Hβ vs [NII]/Hα (BPT) diagram between normal star forming (NSF) galaxies and AGN hosts. We also propose a new diagnostic diagram which can be used for optical spectra of galaxies with redshifts up to z= 1.3.