The aim of this study was to compare the efficacy and tolerability of the new aromatase inhibitor 'ARIMIDEX' (anastrozole) with megestrol acetate in the treatment of advanced breast cancer in postmenopausal women. Anastrozole is a new potent and highly selective non-steroidal aromatase inhibitor. We conducted a prospective randomised trial comparing two doses of anastrozole (1 and 10 mg orally once daily) with megestrol acetate (40 mg orally four times daily) in postmenopausal patients with advanced breast cancer who progressed after prior tamoxifen therapy. All patients were analysed for efficacy as randomised (intention to treat) and for tolerability as per treatment received. Of the 378 patients who entered the study, 135 were randomised to anastrozole 1 mg, 118 to anastrozole 10 mg, and 125 patients to megestrol acetate. After a median follow-up of 192 days, response rate which included complete response, partial response and patients who had disease stabilisation for 6 months or more was 34% for anastrozole 1 mg, 33.9% for anastrozole 10 mg and 32.8% for megestrol acetate. There were no statistically significant differences between either dose of anastrozole and megestrol acetate in terms of objective response rate, time to objective progression of disease or time to treatment failure. The three treatments were generally well tolerated, but more patients on megestrol acetate reported weight gain, oedema and dyspnoea as adverse events while more patients on anastrozole reported gastro-intestinal disorders, usually in the form of mild transient nausea. Patients on anastrozole did not report higher incidences of oestrogen withdrawal symptoms. Anastrozole is an effective and well tolerated treatment for postmenopausal patients with advanced breast cancer. The higher 10 mg dose did not result in additional clinical benefit, but was well tolerated reflecting the good therapeutic margin with anastrozole. Based on this data, anastrozole 1 mg should be the recommended therapeutic dose.