Fanconi anemia is a hereditary syndrome of bone marrow failure, congenital anomalies, and a predisposition to malignancy. Most patients die from bone marrow failure. Cells from patients display a heightened sensitivity to DNA cross-linking agents with increased chromosomal breakage and increased cytotoxicity. Bone marrow from patients with Fanconi anemia have decreased numbers of hematopoietic progenitors when grown in culture. Transfer of the normal Fanconi anemia cDNA into cells from patients corrects the laboratory abnormalities, suggesting that gene transfer may prevent or reverse the bone marrow failure. Advances in gene transfer into human hematopoietic cells make this approach seem feasible. However, decreased numbers of stem cell targets may represent a significant obstacle. In addition, new insights on potential toxicities related to gene transfer have heightened a cautious approach. Fanconi anemia represents a prototype disorder for gene therapy and highlights the difficulties in adapting this technology to human disease.