The proteasome is a multicatalytic enzyme complex responsible for the regulated degradation of intracellular proteins. In recent years, inhibition of proteasome function has emerged as a novel anti-cancer therapy. Proteasome inhibition is now established as an effective treatment for relapsed and refractory multiple myeloma and offers great promise for the treatment of other haematological malignancies, when used in combination with conventional therapeutic agents. Bortezomib is the first proteasome inhibitor to be used clinically and a second generation of proteasome inhibitors with differential pharmacological properties are currently in early clinical trials. This review summarises the development of proteasome inhibitors as therapeutic agents and describes how novel assays for measuring proteasome activity and inhibition may help to further delineate the mechanisms of action of different proteasome inhibitors. This will allow for the optimized use of proteasome inhibitors in combination therapies and provide the opportunity to design more potent and therapeutically efficacious proteasome inhibitors.