The separation of myelodysplastic syndromes from acute myeloid leukemia has been problematic because, as clinical entities, they represent different points in the spectrum of the same disease process. A new classification by the World Health Organization has incorporated recent prognostic findings in myelodysplastic syndrome and distinct genetic subtypes of acute myelogenous leukemia to provide an improved conceptual framework, if not a simpler nomenclature. Here, we review the new classification system and discuss its impact on diagnosis and treatment.