Sugarcane (Saccharum spp.) is a tropical and sub-tropical, vegetative-propagated crop that contributes to approximately 80% of the sugar and 40% of the world’s biofuel production. Modern sugarcane cultivars are highly polyploid and aneuploid hybrids with extremely large genomes (>10 Gigabases), that have originated from artificial crosses between the two species, Saccharum officinarum and S. spontaneum. The genetic complexity and low fertility of sugarcane under natural growing conditions make traditional breeding improvement extremely laborious, costly and time-consuming. This, together with its vegetative propagation, which allows for stable transfer and multiplication of transgenes, make sugarcane a good candidate for crop improvement through genetic engineering. Genetic transformation has the potential to improve economically important properties in sugarcane as well as diversify sugarcane beyond traditional applications, such as sucrose production. Traits such as herbicide, disease and insect resistance, improved tolerance to cold, salt and drought and accumulation of sugar and biomass have been some of the areas of interest as far as the application of transgenic sugarcane is concerned. Although there have been much interest in developing transgenic sugarcane there are only three officially approved varieties for commercialization, all of them expressing insect-resistance and recently released in Brazil. Since the early 1990’s, different genetic transformation systems have been successfully developed in sugarcane, including electroporation, Agrobacterium tumefaciens and biobalistics. However, genetic transformation of sugarcane is a very laborious process, which relies heavily on intensive and sophisticated tissue culture and plant generation procedures that must be optimized for each new genotype to be transformed. Therefore, it remains a great technical challenge to develop an efficient transformation protocol for any sugarcane variety that has not been previously transformed. Additionally, once a transgenic event is obtained, molecular studies required for a commercial release by regulatory authorities, which include transgene insertion site, number of transgenes and gene expression levels, are all hindered by the genomic complexity and the lack of a complete sequenced reference genome for this crop. The objective of this review is to summarize current techniques and state of the art in sugarcane transformation and provide information on existing and future sugarcane improvement by genetic engineering.