Animal models have been extensively used to test promising new agents for the treatment and prevention of cancer. Many different animal models are available for preclinical testing, and the choice of the specific model to use is often a critical step in successful drug development. Many different mouse models of human breast cancer have been developed that have been used to test promising anti-cancer drugs. These include mouse models that spontaneously develop mammary tumors, carcinogen-treated mouse models, xenograft models, transgenic mice and gene knockout mice that develop mammary tumors. The particular strengths and weakness of these models for testing therapeutic agents will be reviewed. The most widely used preclinical models for testing agents for the treatment of cancer are xenograft models. Xenograft studies using human cancer cell lines are easily conducted, are relatively rapid and, importantly, are recognized by the Food and Drug Administration as providing evidence of preclinical anti-tumor activity against human cancer. However, certain studies cannot be done using xenografts of human cancer cell lines. These include testing of immune-based therapies or testing of cancer preventive agents. For such studies, other models are needed. Testing of novel vaccines against cancer requires an immunocompetent host, and thus may require vaccination against murine tumors or studies to be done in 'humanized' mice. Studies of cancer preventive agents requires xenografts of human normal breast tissue or carcinoma-in-situ lesions, or alternatively mouse or rat models that develop tumors, either spontaneously or after carcinogen treatment. One of the most commonly used models for testing chemopreventive agents has been the carcinogen-treated rat model. This model has been successfully used to demonstrate the chemopreventive activity of many agents, including selective estrogen receptor modulators (SERMs) such as tamoxifen, raloxifene, and idoxifene, and retinoid compounds, and is particularly useful for testing agents for the prevention or treatment of estrogen receptor-positive mammary cancer. More recently, transgenic mouse models have been used to study the activity of chemopreventive agents, particularly for the prevention of estrogen receptor-negative breast cancer. We have used two such transgenic mice (C3(1)-SV40 T antigen, and mouse mammary tumor virus [MMTV]-erbB2 mice) to investigate the preventive activity of receptor-selective retinoid compounds. Both of these transgenic mouse lines develop premalignant lesions that then evolve into invasive mammary tumors that eventually metastasize. We have found that 9-cis-retinoic acid, which binds both retinoic acid receptors and retinoid X receptors (RXRs), and the RXR-selective retinoid, LGD1069 (bexarotene, Targretin), suppresses the development of non-invasive and invasive mammary tumors in both C3(1) SV40 T antigen mice and MMTV-erbB2 mice. These retinoids interfere with tumorigenesis by suppressing proliferation of normal and premalignant mammary epithelial cells, ultimately suppressing the development of invasive cancer. Based on these results in these mouse models, we initiated a human clinical trial using retinoids for the prevention of human breast cancer, which is now ongoing. These results demonstrate the utility of genetically engineered mouse models for the testing of molecularly targeted agents for the prevention of breast cancer.