5-Azacytidine, a DNA methyl transferase inhibitor, is effective in patients with myelodysplastic syndromes (MDS). Whether responses to 5-Azacytidine are achieved by demethylation of key genes or by cytotoxicity is unclear. Of 34 patients with MDS or acute myeloid leukaemia (AML) treated with 5-Azacytidine, 7 achieved complete remissions (CR)(21%) and 6 achieved haematological improvement. All six had less than 5% bone marrow (BM) blasts at the time of haematological improvements (HI)(2 had pre-existing refractory anaemia (RA), 4 had refractory anaemia with excess blasts (RAEB)). A further patient with RAEB had blast reduction to less than 5% without HI. Five of the seven (71%) complete responders had chromosome 7 abnormalities. BM CR predicted longer overall survival (OS)(median 23 versus 9 months, P= 0.015). Bisulphite genomic sequencing (BGS) of the CDKN2B (p15 INK4b) promoter showed low level, heterogeneous pretreatment methylation (mean 12.2%) in 14/17 (82%) patients analysed. Lower baseline methylation occurred in responders (9.8% versus 16.2% in non-responders P= 0.07). No response was seen in patients with> 24% methylation, in whom p15 INK4b mRNA was not expressed. 5-Azacytidine reduced CDKN2B methylation by mean 6.8% in 8/17 (47%) patients, but this did not correlate with response. At 75 mg/m 2, cell death (reduced BM cellularity (P= 0.001) and increased apoptosis (P= 0.02)) rather than demethylation of CDKN2B correlates with response. Patients with> 24% methylation may benefit from alternative dosing or combination strategies.