Great progress has been made in recent years in studies on the mechanism of Agrobacterium-mediated transformation and its application. Many details of the key molecular events within the bacterial cells involved in T-DNA transfer have been elucidated, and it is notable that some plant factors which were elusive before are purified and characterized. Vast kinds of species, which were either recalcitrant to or not included in the host range of Agrobacterium, can now be transformed by this bacterium, and they include the very important cereal species, gymnosperms, yeast and many filamentous fungi. The simple in vivo transformation of tissue in intact plants and the "agrolistic" methods to transform recalcitrant plants are the two novel technical achievements. Combined with other powerful techniques such as bacterial artificial chromosome, very large DNA fragment can be transformed into the plant genome by Agrobacterium. Further studies will elucidate more plant-encoded factors involved in T-DNA transformation and there is a need to develop more powerful Agrobacterium-based transformation systems to meet different needs in basic research and crop improvement practice.