As cancer gene therapy employing replication-defective vectors has met with limited clinical success, there is renewed interest in using replication-competent viruses for oncolytic virotherapy. In preclinical and clinical studies, various attenuated vaccine strains and engineered virus vectors are currently being tested for their ability to achieve tumor-selective cell killing. However, significant improvements are still required in tumor selectivity, cytolytic potency, and modulating immune responses to achieve anti-tumor effects without prematurely terminating virus spread. Recently, we have developed murine leukemia virus (MLV)-based replication-competent retrovirus (RCR) vectors for highly efficient, selective, and persistent gene transfer to cancer cells, and found that such vectors may offer significant advantages as oncolytic agents. In a variety of preclinical models, RCR vectors can achieve efficient and persistent gene delivery as the virus replicates throughout an entire tumor mass after inoculation with initial multiplicities of infection as low as 0.001. When engineered to deliver suicide genes, RCR vectors achieve highly efficient and synchronized cell killing triggered by pro-drug administration, both in culture and in tumor models in vivo. Further strategies are being explored to enhance the packaging capacity, efficiency, and specificity of this vector system through the development of semi-replicative RCR vectors, adenovirus-RCR hybrids, and incorporation of tumor targeting mechanisms via modification of binding tropism and transcriptional regulation. In addition, the ability of these vectors to achieve stable transgene expression in infected tumor cells may allow therapeutic applications that move beyond oncolysis per se.