In nonmyeloablative allogeneic hematopoietic stem cell transplantation (HSCT), high-dose cytotoxic therapy as the conceptual basis for treating hematopoietic malignancies has been replaced by graft-versus-tumor effects. The use of potent pre- and postgrafting immunosuppression derived from preclinical studies has allowed omission of myeloablative cytotoxic therapy without compromising hematopoietic donor cell engraftment. This results in a marked reduction in transplant-related toxicities that makes older or medically infirm patients candidates for this treatment option. This patient group is more representative of the population with cancer and would have been ineligible for conventional HSCT. Initial results in patients with a variety of hematologic malignancies have been encouraging with documented sustained cytogenetic and molecular remissions in a substantial number of sometimes heavily pretreated and previously refractory patients. Even though patients with hematologic malignancies will likely require conversion to full donor hematopoiesis for long-term disease control, a state of mixed hematopoietic chimerism might suffice to "cure" the disease phenotypes in various nonmalignant diseases. Strategies aimed at optimizing peritransplant immunosuppression may eventually eliminate the need for pretransplant total body irradiation, which is relevant for minimizing late toxicities. Enhancing graft-versus-tumor effects by virtue of postgrafting vaccination of recipients against tumor-specific antigens may help to use this transplant approach more effectively in the treatment of solid tumors.