Etanercept (Enbrel, Immunex Corporation, Seattle, Washington, USA) is a new biological disease-modifying antirheumatic drug (DMARD) for the treatment of active rheumatoid arthritis (RA). It is one of two TNF-alpha blockers to be licensed for the treatment of active RA and is classified as a recombinant human soluble TNF receptor. The drug competitively inhibits the binding of TNF to cell surface receptors and thus renders TNF biologically inactive. In doing so, etanercept inhibits the pro-inflammatory effects of TNF and results in a reduction of joint inflammation in patients with RA. Etanercept has shown a statistically significant reduction in swollen and inflamed joint counts, biochemical markers such as erythrocyte sedimentation rate and C-reactive protein and shown significant improvements in quality of life measures (HAQ and global assessment scores) in all studies. In early disease, etanercept has shown a reduction in joint space narrowing equal to methotrexate (MTX) and a reduction in the appearance of new erosions significantly better than MTX after 1 year of treatment. Etanercept has a rapid onset of action which is significantly faster than standard DMARDs. Etanercept was well-tolerated in clinical trials. The commonest side effects were injection site reactions and upper respiratory tract infections. Etanercept therapy has resulted in serious infections in some patients and should be used with caution in any patient with a history of recurring infections or with disease states that may predispose to infections. In summary, etanercept is an effective and well-tolerated agent that is a significant breakthrough in the treatment of this disabling condition.