Metastatic tumor cells can interfere directly with the function of bone cells involved in normal bone remodeling or indirectly by influencing the behavior of hematopoietic, stromal and other cells in bone marrow that interact with bone cells. Recent studies of metastatic cancer have revealed that tumor cells interact closely with vascular endothelial cells, basement membrane and bone marrow stromal cells through cell surface proteins or by releasing factors which affect the function of these cells. Bidirectional interaction between marrow cells and tumor cells can give the latter a selective advantage for growth in bone which can lead to the destruction of or to increased production of bone matrix. Understanding of the mechanisms involved in tumor metastasis and growth in bone has increased in recent years, and in this review we shall describe current knowledge of these mechanisms and of the predilection of certain types of cancers to metastasize to bone, their growth in the bone microenvironment and interactions between them and bone cells. Because metastatic breast cancer has been studied more than any other, we shall focus on it as a representative example, although the general principles apply to other types of cancer and to myeloma.