Oral and intestinal mucositis are among the most significant dose-limiting toxic effects of intensive cancer treatment and are associated with adverse clinical and economic outcomes. Palifermin (Kepivancetrade mark), an N-truncated recombinant human keratinocyte growth factor-1, is the first agent to be approved for prevention of oral mucositis. Keratinocyte growth factor, a potent epithelial mitogen, appears to play a major role in the healing process. Palifermin has multiple biological activities that appear to protect the mucosal epithelium and promote its early regeneration after irradiation- and chemotherapy-induced injury. These include inhibition of epithelial cell apoptosis and DNA damage, up-regulation of detoxifying enzymes and down-regulation of pro-inflammatory cytokines, as well as enhanced migration, proliferation and differentiation of epithelial cells. Palifermin reduces the incidence, severity and duration of oral mucositis in patients with haematological malignancies undergoing myelotoxic conditioning therapy and haematopoietic stem-cell transplantation. Clinical sequelae, including febrile neutropenia and resource use (opioid analgesia and parenteral feeding), are concomitantly reduced. Other potential applications being explored include use in the solid tumour setting, reduction of intestinal mucositis and reduction of GVHD in allogenic transplantation. Thus, the development of palifermin and other potential new agents for preventing chemotherapy- and radiotherapy-induced mucositis represents an important breakthrough in oncological supportive care.