Retinoids are the natural and synthetic derivatives of vitamin A. Epidemiological studies indicate that a low intake of vitamin A is associated with an increased risk of squamous cancer. In vitro studies on cancer cells show that exposure to retinoids results in the inhibition of growth, by blocking the cell cycle or by inducing apoptosis. With respect to the clinical efficacy of retinoids some positive effects have been observed in early stage oral and oropharyngeal cancer. Administration of retinoids has been shown to elicit responses in leukoplakia, a premalignant lesion of the oral mucosa that frequently develops into invasive cancer. Furthermore, it has been possible with a retinoid, 13-cis-retinoic acid, to delay or inhibit the development of second primary tumors in patients who have been curatively treated for a first primary tumor in the oral cavity or oropharynx. Recent trials, however, failed to show protective effects on the development of second primary tumors. Because of the short duration of the response, the intrinsic resistance to retinoids and the toxic side effects, the treatment with this class of compounds has not become a standard therapy. Recent studies have shed light on how preneoplastic and neoplastic cells defend themselves against the growth inhibiting action of retinoids. An increased retinoid breakdown and an inactivation of nuclear retinoid receptor appear to be the cause of acquired or intrinsic resistance. This knowledge can be used to develop novel tumor-selective strategies. This review gives an update on the role of retinoids in oral and oropharyngeal cancer and their precursor lesions. The focus will be on the anticancer activity, the mechanism of action and future directions.