Cancer chemotherapeutic prodrugs, such as the oxazaphosphorines cyclophosphamide and ifosfamide, are metabolized by liver cytochrome P450 enzymes to yield therapeutically active, cytotoxic metabolites. The effective use of these prodrugs is limited by host toxicity associated with the systemic distribution of cytotoxic metabolites formed in the liver. This problem can, in part, be circumvented by implementation of cytochrome P450 gene-directed enzyme prodrug therapy (P450 GDEPT), a prodrug activation strategy for cancer treatment that augments tumor cell exposure to cytotoxic drug metabolites generated locally by a prodrug-activating cytochrome P450 enzyme. P450 GDEPT has been exemplified in preclinical rodent and human tumor models, where chemosensitivity to a P450 prodrug can be greatly increased by introduction of a prodrug-activating P450 gene. Further enhancement of the efficacy of P450-based gene therapy can be achieved: by co-expression of P450 with the flavoenzyme NADPH-P450 reductase, which provides electrons required for P450 metabolic activity; by metronomic (anti-angiogenic) scheduling of the prodrug; by localized delivery of the prodrug to the tumor; and by combination with anti-apoptotic factors, which slow the death of the P450 'factory' cells and thereby enhance the bystander cytotoxic response. P450 GDEPT has several important features that make it a clinically attractive strategy for cancer treatment. These include: the substantial bystander cytotoxicity of P450 prodrugs such as cyclophosphamide and ifosfamide; the ability to use human P450 genes and thereby avoid an immune response to the therapeutic gene; the use of well-established conventional chemotherapeutic prodrugs, as well as bioreductive drugs activated by P450/P450 reductase in a hypoxic tumor environment; and the potential to decrease systemic exposure to active drug metabolites by selective inhibition of hepatic P450 activity. Recent advances in this area of research are reviewed, and two proof-of-concept clinical trials that highlight the utility of this strategy are discussed.