There has been considerable progress in recent years in developing physiological models for the pharmacokinetics of toxic chemicals and in the application of these models in cancer risk assessment. Physiological pharmacokinetic models consist of a number of individual compartments, based on the anatomy and physiology of the mammalian organism of interest, and include specific parameters for metabolism, tissue binding, and tissue reactivity. Because of the correspondence between these compartments and specific tissues or groups of tissues, these models are particularly useful for predicting the doses of biologically active forms of toxic chemicals at target tissues under a wide variety of exposure conditions and in different animal species, including humans. Due to their explicit characterization of the biological processes governing pharmacokinetic behaviour, these models permit more accurate predictions of the dose of active metabolites reaching target tissues in exposed humans and hence of potential cancer risk. In addition, physiological models also permit a more direct evaluation of the impact of parameter uncertainty and inter-individual variability in cancer risk assessment. In this article, we review recent developments in physiologic pharmacokinetic modeling for selected chemicals and the application of these models in carcinogenic risk assessment. We examine the use of these models in integrating diverse information on pharmacokinetics and pharmacodynamics and discuss challenges in extending these pharmacokinetic models to reflect more accurately the biological events involved in the induction of cancer by different chemicals.