During the past decade, new developments have increased our understanding of the biological features of multiple myeloma (MM), and novel therapeutic approaches have improved the outcome and quality of life. The importance of both the malignant clone and the bone marrow environment for disease evolution and propagation has been recognized, and therapeutic approaches that target both components of the disease process appear to be most promising. Along this line, thalidomide has been observed to exert activity in chemotherapy-refractory MM and thus expands the therapeutic armamentarium against MM. Use of high-dose melphalan with autologous stem cell transplantation has resulted in an improved rate of complete remissions as well as prolonged event-free and overall survival. Novel treatment strategies exploiting anti-myeloma immunity (nonmyeloablative allogeneic transplantation, vaccination) are being investigated and carry the potential to further improve the outcome of patients with MM.