The presence of multiple areas of hypoxia (low oxygen tension) is a hallmark feature of human and experimental tumors. Monocytes are continually recruited into tumors, differentiate into tumor-associated macrophages (TAMs), and then accumulate in these hypoxic areas. A number of recent studies have shown that macrophages respond to the levels of hypoxia found in tumors by up-regulating such transcription factors as hypoxia-inducible factors 1 and 2, which in turn activate a broad array of mitogenic, pro-invasive, pro-angiogenic, and pro-metastatic genes. This could explain why high numbers of TAMs correlate with poor prognosis in various forms of cancer. In this review, we assess the evidence for hypoxia activating a distinct, pro-tumor phenotype in macrophages and the possible effect of this on the growth, invasion, angiogenesis, and immune evasion of tumors. We also discuss current attempts to selectively target TAMs for destruction or to use them to deliver gene therapy specifically to hypoxic tumor sites.