The polymorphic nature of the cytochrome P450 (CYP) genes affects individual drug response and adverse reactions to a great extent. This variation includes copy number variants (CNV), missense mutations, insertions and deletions, and mutations affecting gene expression and activity of mainly CYP2A6, CYP2B6, CYP2C9, CYP2C19 and CYP2D6, which have been extensively studied and well characterized. CYP1A2 and CYP3A4 expression varies significantly, and the cause has been suggested to be mainly of genetic origin but the exact molecular basis remains unknown. We present a review of the major polymorphic CYP alleles and conclude that this variability is of greatest importance for treatment with several antidepressants, antipsychotics, antiulcer drugs, anti-HIV drugs, anticoagulants, antidiabetics and the anticancer drug tamoxifen. We also present tables illustrating the relative importance of specific common CYP alleles for the extent of enzyme functionality. The field of pharmacoepigenetics has just opened, and we present recent examples wherein gene methylation influences the expression of CYP. In addition microRNA (miRNA) regulation of P450 has been described. Furthermore, this review updates the field with respect to regulatory initiatives and experience of predictive pharmacogenetic investigations in the clinics. It is concluded that the pharmacogenetic knowledge regarding CYP polymorphism now developed to a stage where it can be implemented in drug development and in clinical routine for specific drug treatments, thereby improving the drug response and reducing costs for drug treatment.