Tumor necrosis factor alpha (TNF-alpha) and vascular endothelial growth factor (VEGF) play an important role in the biology of chronic lymphocytic leukemia (CLL) cells. Thalidomide is a first-generation immuno-modulating agent that down-regulates TNF-alpha and VEGF. We initiated a phase 1/2 clinical trial to determine the safety and efficacy of combining thalidomide with fludarabine in patients with treatment-naïve CLL. Patients received 6 months of continuous daily thalidomide with standard monthly doses of fludarabine. Three dose levels of thalidomide (100, 200, and 300 mg) were studied. Results from the phase 1 part of this study are reported here. Thirteen patients were enrolled in the phase 1 component of the study. Dose-limiting toxicity was not reached. The most common toxicities noted were fatigue, constipation, and peripheral sensory neuropathy. Overall response rate was 100% with 55% of patients achieving complete remissions. At a median follow-up of 15+ months none of the patients have had a relapse and the median time to disease progression has not yet been reached. Responses were noted at all dose levels. Thalidomide given up to 300 mg/day concurrently with fludarabine in patients with previously untreated CLL shows encouraging clinical efficacy and acceptable toxicity. An ongoing phase 2 part of this study will help validate the clinical efficacy of this regimen.