Histone deacetylase (HDAC) inhibitors are emerging as promising anticancer drugs. Because aberrant activity and expression of HDACs have been implicated in various cancer types, a wide range of HDAC inhibitors are being investigated as anticancer agents. Furthermore, due to the demonstrable anticancer activity in both in vitro and in vivo studies, numerous HDAC inhibitors have undergone a rapid phase of clinical development in various cancer types, either as a monotherapy or in combination with other anticancer agents. Although preclinical trials show that HDAC inhibitors have a variety of biological effects across multiple pathways, including regulation of gene expression, inducing apoptosis and cell cycle arrest, inhibiting angiogenesis, and regulation of DNA damage and repair, the mechanism by which the clinical activity is mediated remains unclear. Understanding the mechanisms of anticancer activity of HDAC inhibitors is essential not only for rational drug design for targeted therapies, but for the design of optimized clinical protocols. This paper describes the links between HDACs and cancer, and the underlying mechanisms of action of HDAC inhibitors against hematological malignancies and solid tumors. Further, this review presents the clinical outcomes of vorinostat, romidepsin, and belinostat, which are approved by the United States Food and Drug Administration for the treatment of lymphomas.