Up to 25% of patients diagnosed with breast cancer have tumors that overexpress HER2. HER2-positive breast cancer is highly proliferative, difficult to treat, and confers a poor prognosis. The advent of the anti-HER2 monoclonal antibody trastuzumab (Herceptin) has markedly altered the clinical course of both early and advanced HER2-driven breast cancer. Despite the use of trastuzumab, however, patients with HER2-positive breast cancer still experience disease progression. Overcoming that resistance to therapy is our next challenge. This review examines the current understanding of HER2 biology, the mechanisms of action of and resistance to trastuzumab, as well as new therapies on the horizon.