Research into the mechanism of protein transduction has undergone a renaissance in the past five years as many groups have sought to understand the behavior of transducing peptides to harness their enormous therapeutic and diagnostic potential. The field has benefited greatly from rigorous cell biological and biophysical studies of the mechanism used by cell penetrating peptides to enter cells and deliver their cargo. The recent identification of fluid phase endocytosis as the mode of cellular entry for TAT and other protein transduction domains has enhanced our understanding of how transduction facilitates intracellular delivery. Many outstanding questions and contradictions still remain to be resolved in the field. Nevertheless, the current body of work regarding the mechanism of uptake gives a much clearer picture of how these macromolecules enter cells and how we might enhance the bioavailability to take advantage of them clinically.