Researchers have made great progress in defining genetic and molecular alterations that contribute to cancer. New therapeutic targets have been identified and targeted therapeutic agents have been developed, but our ability to evaluate potential drugs has not kept pace. Molecular imaging technologies that monitor biological processes and/or measure levels of targeted macromolecules can contribute significantly to preclinical and clinical drug evaluation. This article describes the drug discovery process, economic problems facing drug discovery and development, and successes and failures in this realm. We briefly describe the available molecular imaging tools, with emphasis on positron emission tomography. We discuss biological processes that are altered in tumors and can be measured by molecular imaging; examples include gene expression, signal transduction, tumor cell metabolism, proliferation, apoptosis, hypoxia, and angiogenesis. We conclude with a proposal to integrate molecular imaging into the drug development process.