Gene expression analysis applied to toxicology studies, also referred to as toxicogenomics, is rapidly being embraced by the pharmaceutical industry as a useful tool to identify safer drugs in a quicker, more cost-effective manner. Studies have already demonstrated the benefits of applying gene expression profiling towards drug safety evaluation, both for identifying mechanisms underlying toxicity, as well as for providing a means to identify safety liabilities early in the drug discovery process. Furthermore, toxicogenomics has the potential to better identify and assess adverse drug reactions of new drug candidates or marketed products in humans. While much still remains to be learned about the relevance and the application of gene expression changes in human toxicology, the next few years should see gene expression technologies applied to more stages and more programs of the drug discovery and development process. This review will focus on how toxicogenomics can or has been applied in drug discovery and development, and will discuss some of the challenges that still remain.