Pentostatin (2'-deoxycoformycin; Nipent), a potent inhibitor of adenosine deaminase, is a purine nucleoside analogue that is highly effective in the treatment of hairy-cell leukemia. This agent is capable of inducing durable complete remissions in the majority of patients, and is capable of re-inducing a complete remission in many of the patients who have relapsed. Pentostatin appears to have changed the natural history of this disease. Long-term follow-up studies suggest that patients with hairy-cell leukemia who are induced into complete remission have a projected survival comparable to age-matched controls. While purine nucleoside analogues induce profound T-cell dysfunction and longstanding immunosuppression, the incidence of secondary malignancies is apparently not increased. Infections still pose a threat to these patients, and effective strategies for treating this disease that do not further compromise the immune system are needed. Patients with this disease should be encouraged to participate in ongoing clinical trials to better define the optimal treatment regimen. New studies should explore the combination of pentostatin and rituxan in treating the typical form of hairy-cell leukemia, and the incorporation of new agents for those with the rare variant form of this disease.