Post-translational modification of proteins with isoprenoids was first recognized as a general phenomenon in 1984. In recent years, our understanding, including mechanistic studies, of the enzymatic reactions associated with these modifications and their physiological functions has increased dramatically. Of particular functional interest is the role of prenylation in facilitating protein–protein interactions and membrane-associated protein trafficking. The loss of proper localization of Ras proteins when their farnesylation is inhibited has also permitted a new target for anti-malignancy pharmaceuticals. Recent advances in the enzymology and function of protein prenylation are reviewed in this article.