Recent developments in the generation and characterization of genetically engineered mouse models of human cancer have resulted in notable improvements in these models as platforms for preclinical target validation and experimental therapeutics. In this review, we enumerate the criteria used to assess the accuracy of various models with respect to human disease and provide some examples of their prognostic and therapeutic utility, focusing on models for cancers that affect the largest populations. Technological advancements that allow greater exploitation of genetically engineered mouse models, such as RNA interference in vivo, are described in the context of target and drug validation. Finally, this review discusses stratagems for, and obstacles to, the application of these models in the drug development process.