Evidence for drug resistance in giardiasis is reviewed and biochemical studies undertaken to determine the basis for this resistance are discussed. Metronidazole and furazolidone, which produce toxic radicals within the cell, have different biochemical mechanisms of action. Resistance to metronidazole is negatively correlated with the intracellular concentration of pyruvateferredoxin oxidoreductase leading to a concomitant decrease in the uptake of free metronidazole into the cell, while resistance to furazolidone appears to be due to an increase in thiol cycling enzymes. At the molecular level resistance to metronidazole is associated with DNA changes. DNA probes which hybridize with specific chromosomes and repetitive sequences indicate that rearrangements both at the chromosome and repetitive DNA level occurred concurrently with the development of metronidazole resistance. The problems of cross-resistance and treatment failures that occur in the absence of resistance are additional difficulties which have important implications for the management of individual patients. New drugs such as azithromycin, while showing great variation in activity against different stocks may be useful in treating some refractory cases of giardiasis. In the community, it is important to recognize the occurrence and spread of drug resistant Giardia, and markers, such as DNA probes, provide methods to monitor potential epidemics and the spread of drug resistant Giardia.