Microphthalmia-associated transcription factor (MITF) acts as a master regulator of melanocyte development, function and survival by modulating various differentiation and cell-cycle progression genes. It has been demonstrated that MITF is an amplified oncogene in a fraction of human melanomas and that it also has an oncogenic role in human clear cell sarcoma. However, MITF also modulates the state of melanocyte differentiation. Several closely related transcription factors also function as translocated oncogenes in various human malignancies. These data place MITF between instructing melanocytes towards terminal differentiation and/or pigmentation and, alternatively, promoting malignant behavior. In this review, we survey the roles of MITF as a master lineage regulator in melanocyte development and its emerging activities in malignancy. Understanding the molecular function of MITF and its associated pathways will hopefully shed light on strategies for improving therapeutic approaches for these diseases.