Anemia represents a common side effect of cancer chemotherapy, and results in diminished overall well-being as well as side effects such as dyspnea, fatigue and decreased appetite. Treatment options for chemotherapy-induced anemia are transfusion of red blood cells and s.c. erythropoietin. Although transfusion is generally well tolerated, patients usually experience fluctuating hemoglobin levels because of hesitancy to transfuse to normal hemoglobin levels. Additionally, concerns persist related to the safety of blood products, including the transmission of blood-borne pathogens, immunomodulation by transfusion and severe allergic reactions, despite advances in transfusion medicine. Erythropoietin is an effective alternative to transfusion in many patients and allows for a more consistent hemoglobin level. The costs associated with the drug have limited its use. In addition, patient preferences for the two treatment options have not been investigated. Economic analyses, including consideration of the costs associated with medical care as well as the consequences, will be essential in evaluating the potential of transfusions and erythropoietin in treating the anemia associated with cancer chemotherapy.