Post-translational modification of proteins by the addition of a farnesyl group is critical for the function of a number of proteins involved in signal transduction. Farnesylation facilitates their membrane association and also promotes protein-protein interaction. Recently, progress has been made in understanding the biological significance of farnesylation. First, effects of farnesyltransferase inhibitors (FTIs) on cancer cells have been examined using a variety of human cancer cells. This study showed that one of the major effects of FTIs is to alter cell cycle progression. Both G0/G1 enrichment and G2/M accumulation were observed depending on the cell line examined. Second, a number of novel farnesylated proteins have been characterized. Of these, Rheb and CENP-E,F are of particular interest. Rheb, a novel member of the Ras superfamily G-proteins, may play a role in the G1 phase of the cell cycle. CENP-E,F are centromere associated motors that play critical roles in mitosis. These results suggest important contributions of farnesylated proteins in the regulation of cell cycle progression.