Barley, an important member of the cereals, has been successfully transformed through various methods such as particle bombardment, Agrobacterium tumefaciens, DNA uptake, and electroporation. Initially, the transformation in barley concentrated on developing protocols using marker genes such as gus, bar, and hpt. Immature embryos and callus derived from immature embryos were targeted for transformation. Subsequently, genes of agronomic and malting importance have been deployed in barley. Particle bombardment appears to be the preferred choice for barley transformation in the majority of the reports, although Agrobacterium-mediated transformation is being used more often. The current review focuses on the challenges encountered in barley transformation such as somaclonal variation, development of transformation systems for commercial cultivars, gene expression, stability and inheritance, and gene flow. Newer markers such as the green fluorescent protein (gfp), firefly luciferase, and phosphomannose isomerase were found to be useful in the selection of transgenic plants. Tissue-specific promoters such as those for B1-hordein and D-hordein genes, and spike-specific promoters, are increasingly used to drive gene expression. The review also describes recent research on gene-tagging through transformation, insertion of disease resistance, and abiotic stress resistance genes, transformation with genes for improved malting quality, nutrient content, feed quality, and the production of feed enzymes and pharmaceutical compounds.