Caspofungin is the first approved agent from a new class of antifungals, the echinocandins. By targeting the fungal cell wall (as opposed to the fungal cell membrane), the echinocandins exhibit a unique mechanism of action relative to the other currently approved antifungal agents. Preclinical (in vitro and in vivo) studies have demonstrated activity for caspofungin against the most commonly encountered fungi in the hospital setting, namely Candida and Aspergillus species. Caspofungin is administered as a once-a-day, intravenous formulation. Notably, caspofungin is neither an inhibitor, inducer, nor metabolite of the cytochrome p450 system. To date, few drug-drug interactions have been seen for this echinocandin. A number of Phase II and III clinical studies in documented invasive candidiasis, esophageal candidiasis, and invasive aspergillosis have been completed and have demonstrated efficacy for caspofungin against all three diseases. In all studies, caspofungin manifested an excellent safety profile with few serious, drug-related adverse events or discontinuations due to drug-related adverse events. Isolated symptoms compatible with histamine release have been infrequently reported. In clinical studies, drug-related nephrotoxicity with caspofungin has been rare, and the incidence of liver transaminase elevations has been similar to the incidence seen with comparator agents. Results from a Phase III study as empirical therapy in patients with febrile neutropenia are anticipated in late 2003. Overall, caspofungin represents an important addition to the current antifungal armamentarium.