Traditional breeding efforts dramatically transformed the cotton (Gossypium spp.) plant during the last century. In the coming decade, the high priority breeding objectives for production regions of the western US (far-western Texas, New Mexico, Arizona, and California) will involve morphologically complex traits controlled by many interacting genes. Although perennial concerns regarding yield, response to pests (lygus, thrips, aphids, and whitefly), and disease resistance (seedling fungal diseases, Fusarium and Verticillum wilts, and root-knot nematode) remain, plant characteristics conferring improved water-use efficiency, heat tolerance, and fiber quality traits will become increasingly important to the cotton industry. Adoption of transgenic cotton in New Mexico in the early 2000s resulted in decreased planting of conventional Acala 1517 cultivars, which declined to approximately 5% of total planting by 2005. However, a transgenic cultivar containing Bt, Acala 1517-99W, became available in 2006 and planting of that cultivar increased to 14% of total production in that same year. In Arizona, improvements in productivity and fiber quality in American Pima (G. barbadense L.) were made possible by emphasizing selection for adaptation to high temperature environments. However, yield losses attributed to heat stress continue to be significant in Upland, Pima, and Acala cottons, with long-term estimates averaging about 12% annually in Arizona alone. Further improvements will require the development of better selection tools, both phenotypic and molecular, for heat tolerance. In California, Fusarium wilt race 4 currently poses new challenges, making breeding for resistance against this pathogen a priority. With cotton hectarage declining in the western production regions from approximately 800,000 ha in the 1970s to less than 285,000 today, and a continuing shift in production from Acala to Pima, sustainability of the industry will likely require that breeders emphasize high yields, reduced production inputs, and lint characteristics that attract premium prices.