Increasing knowledge is generating promising marker candidates for diagnosis, prognosis assessment, and therapeutic targeting. To apply these results to maximize patient benefit, a disciplined application of well-designed trials for assessing the utility of markers should be employed. We review issues to consider when designing a clinical trial assessing the usefulness of a predictive marker, that is, a marker intended to be used to select a specific therapy for a patient based on the biomarker’s status. First the use of biomarkers in the early stage trial setting (phase I and II) will be reviewed, subseuqntly turning to options for validating a predictive biomarker in the phase III setting. The pros and cons of retrospective vs prospective validation will be reviewed, and the multiple approaches to prospective validation will be compared. Examples from oncology will be used.