The first of the so-called “novel agents” (thalidomide, lenalidomide, and bortezomib), thalidomide has demonstrated activity as a single agent and in combination with other agents in patients with relapsed and/or refractory MM. The combination of melphalan, prednisone, and thalidomide (MPT) has become a standard treatment option for newly diagnosed patients who are ineligible for high-dose chemotherapy with autologous stem cell transplantation (ASCT). For patients intending to undergo ASCT, the combination of thalidomide, dexamethasone and cyclophosphamide can be used as a non-myelosuppressive induction regimen. Treatment with thalidomide is associated with an increased risk of developing peripheral neuropathy, which can be managed with dose reductions and discontinuation, and venous thromboembolism, which warrants thromboprophylaxis. While its adverse event profile may preclude prolonged use as maintenance therapy, thalidomide is an effective and well-tolerated salvage therapy option. Ongoing trials continue to evaluate novel thalidomide-based regimens to further optimize the use of thalidomide in the management of MM.