Rhabdomyosarcoma (RMS) is the most common soft tissue sarcoma of childhood. The two most common histologic variants are the embryonal and alveolar subtypes. Although successive collaborative group clinical trials have improved survival rates for many RMS patients, the outcome for those patients with metastatic or recurrent disease remains poor. Recent studies have pointed to a possible mesenchymal stem cell as the progenitor for alveolar RMS. Other studies have implicated several cellular mechanisms and pathways being involved in RMS pathogenesis and survival, such as the cyclin-dependent kinase inhibitors, insulin-like growth factor pathway, and the mammalian target of rapamycin pathway, thus providing potential avenues for targeted therapy. Recent clinical trials have tried to improve risk stratification and prediction of clinical outcome based upon clinical or radiographic response to initial therapy and also to determine the role of high-dose chemotherapy with stem cell rescue in high-risk RMS patients.