Epigenetic changes such as DNA methylation act to regulate gene expression in normal mammalian development. However, promoter hypermethylation also plays a major role in cancer through transcriptional silencing of critical growth regulators such as tumor suppressor genes. Other chromatin modifications, such as histone deacetylation and chromatin-binding proteins, affect local chromatin structure and, in concert with DNA methylation, regulate gene transcription. The DNA methylation inhibitors azacitidine and decitabine can induce functional re-expression of aberrantly silenced genes in cancer, causing growth arrest and apoptosis in tumor cells. These agents, along with inhibitors of histone deacetylation, have shown clinical activity in the treatment of certain hematologic malignancies where gene hypermethylation occurs. This review examines alteration in DNA methylation in cancer, effects on gene expression, and implications for the use of hypomethylating agents in the treatment of cancer.