Lenalidomide is an immunomodulatory drug derived from thalidomide. It was developed to maximize the anti-inflammatory and anti-neoplasic properties of thalidomide and to reduce its toxicity. The molecular mechanism of action of lenalidomide is unclear, but its therapeutic activity is mainly due to its well defined anti-inflammatory, immunomodulatory, anti-proliferative and anti-angiogenic properties. In relapsed or refractory multiple myeloma (MM), lenalidomide, combined with standard dose dexamethasone, is superior to dexamethasone alone in terms of time to progression, response rate and overall survival. The most commonly reported adverse events include haematological toxicity with manageable neutropenia and thrombopenia. Lenalidomide does not trigger the limiting toxicities of thalidomide: somnolence, neuropathy and constipation. Lenalidomide, in combination with dexamethasone, is indicated for the treatment of MM patients who have received at least one prior therapy and is administered orally at the dose of 25 mg q.d. for 21 days of 28-day cycles. The drug is being investigated for the treatment of newly diagnosed MM. In this review, we summarize the pharmacokinetic, pharmacodynamic and clinical trial data on lenalidomide.