Alcohol is, together with tobacco smoke, the main cause for upper GI tract cancer in industrialized countries. However, the tumour-promoting effects of alcohol intake are poorly understood and alcohol itself is not carcinogenic in the animal model. There is increasing evidence that alcohol metabolism, rather than the alcohol itself, generates carcinogenic and cell-toxic compounds. Acetaldehyde, first metabolite of ethanol, is highly toxic, mutagenic and carcinogenic. Polymorphisms in the genes coding for enzymes responsible for acetaldehyde accumulation and detoxification have been associated with an increased cancer risk. Acetaldehyde can also be produced in the mucosa and by the physiological microflora. This review summarizes the scientific evidence that alcohol intake leads to a local production of acetaldehyde. It describes the role of the oral microflora, the mucosa and the salivary glands in this process and shows that local acetaldehyde production from ethanol may contribute to the carcinogenesis of alcohol intake in the upper GI tract.