The Department of Defense has been a leader in Radiology re- engineering for the past decade. Efforts have included the development of two landmark PACS specifications (MDIS and DIN- PACS), respective vendor selection and implementation programs. A Tri-Service (Army, Navy and Air Force) Radiology re-engineering program was initiated which identified transitioning to digital imaging, PACS and teleradiology as key enabling technologies in a changing business scenario. Subsequently, the systematic adjustment of procurement process for radiological imaging equipment included a focus on specifying PACS-capable-digital imaging modalities and mini- PACS as stepping stones to make the hospitals and health clinics PACS-ready. The success of the PACS and teleradiology program in the DOD is evidenced by the near filmless operation of most Army and Air Force Medical Centers, several community hospitals and several operational teleradiology constellations. Additionally, the MDIS PACSystem has become the commercial PACS product for General Electric Medical Systems. The DOD continues to forge ahead in the PACS arena by implementing advanced configurations and operational concepts such as the VRE (Virtual Radiology Environment), the negotiation of Regional Archiving and Regional PACS Maintenance Programs. Newer regulations (HIPAA, the FDA approval of digital mammography) have been promulgated impacting the culture and conduct of our business. Incorporating their requirements at the very outset will enable us to streamline the delivery of radiology. The DOD community has embraced the information age at multiple levels. The Healthcare portion of this community with these initiatives is integrating itself into DOD's future. The future holds great possibilities, promises and challenges for the DOD PACS programs.