Personalized medicine is partially enabled by in vitro diagnostics including pharmacogenomic, proteomic and other functional testing such as therapeutic drug management and toxicological testing. This paper will introduce the conceptual aspects of developing personalized treatment using pharmacogenetics information. The initial discussion will give an overview of the application of pharmacogenetics in personalized medicine, followed by specific examples involving cytochrome P450s drug metabolizing enzymes (CYP enzymes). The paper also discusses the influence of racial and ethnic characteristics of a population on the variation in drug effectiveness and toxicity. The need for implementation of pharmacogenetics in medical education is highlighted.