Gene targeting in mammalian cells has proven invaluable in biotechnology, in studies of gene structure and function, and in understanding chromosome dynamics. It also offers a potential tool for gene-therapeutic applications. Two limitations constrain the current technology: the low rate of homologous recombination in mammalian cells and the high rate of random (nontargeted) integration of the vector DNA. Here we consider possible ways to overcome these limitations within the framework of our present understanding of recombination mechanisms and machinery. Several studies suggest that transient alteration of the levels of recombination proteins, by overexpression or interference with expression, may be able to increase homologous recombination or decrease random integration, and we present a list of candidate genes. We consider potentially beneficial modifications to the vector DNA and discuss the effects of methods of DNA delivery on targeting efficiency. Finally, we present work showing that gene-specific DNA damage can stimulate local homologous recombination, and we discuss recent results with two general methodologies—chimeric nucleases and triplex-forming oligonucleotides—for stimulating recombination in cells.