The erbB2 oncogene belongs to the type I trans-membrane tyrosine kinase family of receptors. Its medical importance stems from its widespread over-expression in breast cancer. This review will focus on the signal transduction through this protein, and explains how the overexpression of erbB2 may result in poor prognosis of breast cancer, and finally it will summerize our current understanding about the therapeutic potential of receptor-targeted therapy in breast cancer. ErbB2 does not have any known ligand which is able to bind to it with high affinity. However the kinase activity of erbB2 can be activated without any ligand, if it is overexpressed, and by heteroassociation with other members of the erbB family (erbB1 or epidermal growth factor receptor, erbB3 and erbB4). This interaction substantially increases the efficiency and diversity of signal transduction through these receptor complexes. In addition, erbB2 forms large scale receptor clusters containing hundreds of proteins. These receptor islands may take part in recruiting cytosolic factors which relay the signal towards the nucleus or the cytoplasm. Overexpression of erbB2 was linked to higher transforming activity, increased metastatic potential, angiogenesis and drug resistence of breast tumor in laboratory experiments. As a corollary of these properties, erbB2 amplification is generally thought to be associated with a poor prognosis in breast cancer patients. These early findings lead to the development of antibodies that down-regulate erbB2. Such a therapeutic approach has already been found effective in experimental tumor models and in clinical trials as well. Further understanding of the importance of erbB2 and growth factor receptors in the transformation of normal cells to malignant ones may once give us a chance to cure erbB2 over-expressing breast cancer.