Recent progress in cancer immunotherapy emphasizes the importance of understanding immune-regulatory pathways in tumours. Dysfunction of antitumour T cells may be due to mechanisms that are evolutionarily conserved or acquired by somatic mutations. The dysfunctional state of T cells has been termed 'exhaustion', on the basis of similarities to dysfunctional T cells in chronic infections. However, despite shared properties, recent studies have identified marked differences between T cell dysfunction in cancer and chronic infection. In this Review, we discuss T cell-intrinsic molecular alterations and metabolic communication in the tumour microenvironment. Identification of the underlying molecular drivers of T cell dysfunction is essential for the continued progress of cancer research and therapy.