Mechanisms of DNA adduct formation by antineoplastic 2-chloroethyl-N-nitrosoureas (CNUs) and of DNA damage induced by these compounds as well as by carcinogenic 2-hydroxyalkylnitrosamines are discussed. CNUs are monofunctional and bifunctional alkylating agents that form, in a quantitatively minor reaction, DNA-DNA crosslinks (XL). In vitro, by far the most abundant alkylation products of DNA are those resulting from 2-hydroxyethylation. The reaction sequence responsible for 2-hydroxyethylation comprises intermediate oxazolidine ring closure followed by generation of 2-hydroxyethylnitrosourea and ethylene oxide. Oxadiazolium intermediates have not been found to play a role. In contrast to the in vitro experiments, in vivo 2-hydroxyethyl adducts are formed to a much lesser extent und 2-chloroethyl adducts are predominant in rat kidney DNA. 2-Hydroxyethylation of phosphate groups introduces extreme instability into the sugar-phosphate backbone since the resulting phosphotriester rapidly breaks down through a dioxaphospholane ring intermediate. Measurements of DNA XL in target tumor tissue and in bone marrow provides a sensitive tool for evaluation in bone marrow provides a sensitive tool for evaluation of hormone-linked cytotoxic agents. The potent environmental carcinogen N-nitrosodiethanolamine (NDELA) has been found to be activated in the rat liver by a two-step metabolic transformation sequence involving alcohol dehydrogenase and, subsequently, sulfotransferase. Evidence for this mechanism is provided by measuring DNA single strand breaks in rat liver DNA and by studying the effect of various enzyme inhibitors on the extent of DNA damage induced in vivo by NDELA and its metabolites.