Molecular genetic manipulation of micro-organisms requires the development of plasmid-mediated transformation systems that include: (i) infusion of exogenous DNA into recipient cells; (ii) expression of genes present on the incoming DNA; and (iii) stable maintenance and replication of the inserted DNA, leading to expression of the desired phenotypic trait. Transformation systems have been developed for only a handful of fungi that are pathogenic to humans, including several species of filamentous fungi, and for a lot of filamentous fungi pathogenic to plants. Development of transformation systems in nearly all filamentous fungi has been delayed considerably, and has only been possible recently with the introduction of electroporation and biolistic methods. The fate of incoming DNA varies greatly among the species, regardless of their phylogenctic relationships. Understanding the fate of incoming DNA is critical for the construction of transforming vectors and the molecular manipulation of the fungi. In this review, recent advances in molecular genetics systems, selectable markers for transformation, the fate of incoming DNA, and further strategies for targeted integration, are discussed in relation to filamentous fungi.