Tofacitinib (CP-690,550; CP-690550; CP690550), an orally active immunosuppressant, is being developed by Pfizer for the treatment of rheumatoid arthritis, inflammatory bowel disease, dry eyes, ankylosing spondylitis, psoriasis, psoriatic arthritis, and for the prevention of transplant rejection. Tofacitinib specifically inhibits Janus activated kinase 3 (JAK3), which has a pivotal role in cytokine signal transduction that governs lymphocyte survival, proliferation, differentiation, and apoptosis. This review discusses the key development milestones and therapeutic trials of this drug.