The antibody trastuzumab and the tyrosine kinase inhibitor lapatinib are approved by the FDA for the treatment of HER2-overexpressing breast cancer. These anti-HER2 drugs are changing the natural history of HER2-overexpressing breast cancer. However, therapeutic resistance to trastuzumab or lapatinib, as either single-agents or in combination with chemotherapy in the metastatic setting, typically occurs within months of starting therapy. Several mechanisms of trastuzumab-resistance have been reported that include signaling from other HER receptors, signaling from receptor tyrosine kinases (RTKs) outside of the HER (ErbB) family, increased phosphatidylinositol 3-kinase signaling, and the presence of truncated forms of HER2. Mechanisms of resistance to lapatinib also point to increased phosphatidylinositol 3-kinase signaling as well as derepression/activation of compensatory survival pathways. In this review, we discuss how these models and mechanisms enhance our understanding of the clinical resistance to HER2-directed therapies.