Hydroxyurea is an effective agent in the treatment of chronic myelogenous leukemia. The toxic reactions have included myelosuppression and megaloblastosis. During long-term maintenance therapy, dermatologic alterations occurred in seven of 20 patients and consisted of partial alopecia, increased pigmentation, scalings, atrophy of the skin and subcutaneous tissues, nail changes, and erythema of the face and hands. The histologic changes were similar to those seen in lichen planus. These observations were a factor leading to the use of hydroxyurea in the treatment of psoriasis.