The therapeutic potential of the antiretroviral drug 9-(2-phosphonylmethoxyethyl)adenine (PMEA, adefovir) for the treatment of human immunodeficiency virus (HIV)- and human hepatitis B virus (HBV) infections is currently being explored in advanced clinical trials. In the present study, we investigated the impact of PMEA on cellular functioning (cell cycle, nucleotide metabolism, nucleic acid synthesis, ...). Moreover, we have unraveled the molecular/biochemical basis underlying the marked differentiation-inducing activity of PMEA (and related analogues) in tumor cells. We could demonstrate that PMEA is endowed with potent antitumor activity in a highly aggressive in vivo tumor model. These findings open new perspectives for the possible application of this type of compounds in cancer chemotherapy. The fact that AIDS patients frequently develop certain types of differentiation-susceptible malignancies (e.g. Kaposi's sarcoma) further attests the clinical relevance of our observations.