The segment of the population older than 65 accounts for about 25% of the total drug expenditures in developed countries. This figure is predicted to reach 40% by the year 2030. Drug therapy in the elderly can be complicated by many factors. The pharmacokinetic processes of absorption, distribution, metabolism, and elimination are altered by the physiologic changes of aging involving body composition and organ function. While the extent of drug absorption is not affected by age, few drugs have delayed rates of absorption after oral administration. Changes in body composition, protein binding, and blood flow do affect the concentrations of free unbound drug, the volume of distribution, and elimination half-life of a number of drugs. The primary goal of drug therapy in the elderly is to improve the quality of life. When medical therapy is required, the physician must be aware of the potential effect of age and disease on pharmacokinetics and pharmacodynamics and of the possible ramifications for adverse drug reactions or interactions. By increasing our knowledge of the action and effects of drugs in the elderly, and by enhancing communication and understanding between physician and patient, we can significantly improve the overall quality of care for the elderly patient.