It is remarkable that nuclear transfer using differentiated donor cells can produce physiologically normal cloned animals, but the process is inefficient and highly prone to epigenetic errors. Aberrant patterns of gene expression in clones contribute to the cumulative losses and abnormal phenotypes observed throughout development. Any long lasting effects from cloning, as revealed in some mouse studies, need to be comprehensively evaluated in cloned livestock. These issues raise animal welfare concerns that currently limit the acceptability and applicability of the technology. It is expected that improved reprogramming of the donor genome will increase cloning efficiencies realising a wide range of new agricultural and medical opportunities. Efficient cloning potentially enables rapid dissemination of elite genotypes from nucleus herds to commercial producers. Initial commercialisation will, however, focus on producing small numbers of high value animals for natural breeding especially clones of progeny-tested sires. The continual advances in animal genomics towards the identification of genes that influence livestock production traits and human health increase the ability to genetically modify animals to enhance agricultural efficiency and produce superior quality food and biomedical products for niche markets. The potential opportunities inanimal agriculture are more challenging than those in biomedicine as they require greater biological efficiency at reduced cost to be economically viable and because of the more difficult consumer acceptance issues. Nevertheless, cloning and transgenesis are being used together to increase the genetic merit of livestock; however, the integration of this technology into farming systems remains some distance in the future.