Chronic graft-versus-host disease (GVHD) is a major cause of morbidity and mortality in long-term survivors of allogeneic stem cell transplantation. The immunopathogenesis of chronic GVHD is, in part, TH-2 mediated, resulting in a syndrome of immunodeficiency and an autoimmune disorder. The most important risk factor for chronic GVHD is prior history of acute GVHD and strategies that prevent acute GVHD also decrease the risk of chronic GVHD. Other important risk factors are the use of a non-T cell-depleted graft, and older age of donor and recipient. Whether recipients of peripheral blood stem cells are at increased risk of chronic GVHD remains unsettled. There are no known pharmacologic agents which can specifically prevent development of chronic GVHD. Agents which have efficacy in the treatment of autoimmune disorders have been utilized as therapy for established chronic GVHD and are associated with response rates of 20% to 80%. Most responses are confined to skin, soft tissue, oral mucosa and occasionally liver. Bronchiolitis obliterans responds infrequently to therapy and is associated with a dismal prognosis. Newer, promising therapeutic strategies under investigation include thalidomide, photopheresis therapy, anti-tumor necrosis factor and B cell depletion with anti-CD20 monoclonal antibody.