Treatment of the hematological malignancies has undergone recent transformation. Advances in gene therapy and molecular techniques, as well as significant gains in computational abilities have supported rapid development of safer and better tolerated therapies for many patients with hematologic cancers. In this review, we discuss novel applications of gene therapy including immunomodulation and gene silencing, and report on the rise of oncolytic viruses to treat malignancies arising in cells of the blood, lymph, and marrow. We discuss the relationship of the tropism of wild-type viruses and their oncolytic behavior as well as tumoricidal and immunostimulatory properties of several attenuated and recombinant viruses in clinical development worldwide. While we have focused on promising virotherapy applications for future development, we also present a historical perspective and identify areas of potential clinical and regulatory practice change. Several of the virus systems being developed for hematogic application are outlined and efficacy data is summarized and presented in the context of ongoing or future human clinical testing. Advantages and limitations of gene and virus therapy are presented to readers including challenges and opportunities to improve treatment tolerability and outcomes for patients with hematologic malignancy.