Anemia is commonly observed in patients with heart failure, and portends worsening functional capacity and poorer long-term prognosis. Nevertheless, uncertainty remains regarding the underlying pathophysiology and natural history of anemia in the setting of chronic heart failure. The optimal therapeutic targets and treatment options for this “anemia of heart failure” are also uncertain. Careful evaluation of potential underlying reversible causes, particularly renal insufficiency and iron or nutritional deficiencies, may lead to potential treatment options. Recent concerns have focused on the appropriate hemoglobin target and the efficacies of erythropoiesis-stimulating agents (ESAs), such as erythropoietin and darbepoetin alfa, in reducing long-term clinical events. Much work is needed to clarify the safety and efficacy of this drug class. Nevertheless, early unblinded studies and phase II results using ESAs in patients with heart failure have found overall significant improvements in exercise capacity and quality of life, and it is hoped that ongoing pivotal outcome trials and investigations into iron supplementation will clarify their appropriate use.