Gene transfer trials with adeno-associated virus (AAV) vectors have initiated to unveil the therapeutic potential of this approach, with some of the most exciting results coming from clinical studies of gene transfer for hemophilia B, congenital blindness, and the recent market approval of the first AAV-based gene therapy in Europe. With clinical development, however, some of the limitations of in vivo gene transfer have emerged; in particular the host immune system represents an important obstacle to be overcome in terms of both safety and efficacy of gene transfer in vivo with AAV vectors. Results in humans undergoing gene transfer indicate that capsid-specific T cell responses directed against transduced cells may limit the duration of transgene expression following AAV gene transfer, and similarly anti-AAV neutralizing antibodies can completely prevent transduction of a target tissue, resulting in lack of efficacy. Anti-AAV neutralizing antibodies are highly prevalent in humans, and the frequency of subjects with detectable titers can reach up to two thirds of the population. The approach to the problem of preexisting humoral immunity to AAV so far has been the exclusion of seropositive subjects, but this solution is far from being optimal. Several additional strategies have been proposed and tested in a variety of preclinical animal models. Future studies will help defining the optimal strategy, or combination of strategies, to successfully treat subjects with preexisting antibodies to AAV due to natural infection or to prior administration of AAV vectors. These advancements will likely have a significant impact on the field of gene transfer with AAV vectors.