Natural killer (NK) cells mediate the acute rejection of bone marrow cell (BMC) allografts, but not solid tissue grafts, in lethally irradiated mice. However, the mechanisms underlying this capability for rejecting BMC remain unclear. NK cells express (1) inhibitory receptors specific for major histocompatibility complex (MHC) class I molecules and (2) activating receptors with diverse specificities. Inhibitory NK receptors confer to NK cells the ability to discriminate between MHC class I-positive and -negative target cells and are therefore involved in the control of NK cell tolerance to self, as well as in the elimination of cells that have downregulation of MHC class I molecules. Preclinical studies in mice have provided good evidence that subsets of NK cells that bear different combinations of both inhibitory and activating Ly49 receptors can interact with each other and target specific BMC rejection, as well as NK cell responses toward tumor cells. Recent clinical studies have also shown that the use of killer cell immunoglobulin-like receptor ligand incompatibility in patients with leukemia who received hematopoietic stem cell transplants correlated not only with the elimination of graft rejection, but also with eradication of tumor and prevention of graft-versus-host disease; this offers a significant advantage for survival. In this review, we attempt to bring together literature regarding the biology of NK cells and discuss the current issues in bone marrow transplantation and the potential clinical role of NK cell alloreactivity in the efficacy of this procedure for immunotherapy of cancer and infectious states.