Bone marrow transplantation (BMT) is an established therapy in pediatric oncology and is increasingly used as curative approach in the treatment of congenital, non-oncologic diseases of the lymphohematopoietic system. There is increasing evidence, however, that BMT can be followed by severe long term effects including neuroendocrine, ophthalmologic, dental and central nervous system abnormalities, particularly in children. Therefore the indication to BMT depends on the results obtained by conventional therapy. Due to the high cure rates of leukemia with conventional therapy BMT is only warranted following relapse except for certain forms with poor prognosis factors. For patients with chronic myelogeneous leukemia, however, BMT is the only chance of cure. In solid tumors the role of BMT is more difficult, because there is no clear evidence that BMT is superior to conventional therapy with regard to long term survival. In severe aplastic anemia, however, the long term results of BMT are clearly better than those obtained by conventional therapy. Other undisputed indications for BMT are severe combined immuno deficiencies and other congenital diseases for which BMT is currently the only curative therapy. Progress with matched unrelated donor transplantations by better histocompatibility testing and more specific immunosuppressive therapy to reduce graft-versus-host disease, still a major problem of allogeneic BMT, as well as the perspectives of gen therapy in the future will offer a chance of cure to many patients without a matched sibling donor.