Changes in human DNA methylation patterns are an important feature of cancer development and progression and a potential role in other conditions such as atherosclerosis and autoimmune diseases (e.g., multiple sclerosis and lupus) is being recognised. The cancer genome is frequently characterised by hypermethylation of specific genes concurrently with an overall decrease in the level of 5 methyl cytosine. This hypomethylation of the genome largely affects the intergenic and intronic regions of the DNA, particularly repeat sequences and transposable elements, and is believed to result in chromosomal instability and increased mutation events. This review examines our understanding of the patterns of cancer-associated hypomethylation, and how recent advances in understanding of chromatin biology may help elucidate the mechanisms underlying repeat sequence demethylation. It also considers how global demethylation of repeat sequences including transposable elements and the site-specific hypomethylation of certain genes might contribute to the deleterious effects that ultimately result in the initiation and progression of cancer and other diseases. The use of hypomethylation of interspersed repeat sequences and genes as potential biomarkers in the early detection of tumors and their prognostic use in monitoring disease progression are also examined.