Inner‐shell ionization and the subsequent x‐ray and Auger‐electron cascades resulting from the filling of inner‐shell vacancies play important roles in radiation biology. These processes are useful as tools for enhancing our understanding of the basic mechanisms of biological response to radiation, as well as being important in biological imaging and radiation therapy. Radioisotopes, such as125I, that form inner‐shell vacancies by electron capture and internal conversion processes, are found to be the short particulary effective in producing biological damage. Because of the short range of Auger electrons emitted in the filling of inner‐shell vacancies the degree of biological response is strongly dependent of the position of the radionuclide relative to the sensitive elements of the cell. For example, when incorporated into the DNA of a cell the decay of125I can be more damging than the passage of a high linear energy transfer (LET) alpha particle.In contrast,125I that is confined to the region of the nuclear membrane has a biological effectiveness comparable to a low‐LET x‐ray exposure. The actual type and amount of damage produced by the filling of an inner‐shell vacancy depends on the position of the excited atom in the cell, the energy and number of Auger electron emitted following inner‐shell ionization, and the chemical environments surrounding the Auger emitter. Examples of the effects of variations in these parameters on the subsequent chemical and biological response are discussed in this report with emphasis on studies of the incorporation of125I in mammalian cell systems.