Diffusion-weighted magnetic resonance (MR) imaging and perfusion MR imaging are advanced techniques that provide information not available from conventional MR imaging. In particular, these techniques have a number of applications with regard to characterization of tumors and assessment of tumor response to therapy. In this review, the authors describe the fundamental principles of diffusion-weighted and perfusion MR imaging and provide an overview of the ways in which these techniques are being used to characterize tumors by helping distinguish tumor types, assess tumor grade, and attempt to determine tumor margins. In addition, the role of these techniques for evaluating response to tumor therapy is outlined.