This paper discusses issues related to the regulation and rational use of thalidomide in Brazil, by means of a historical approach comprising three different stages. The first part is a historical review of the controversial drug since it was first synthesized, then marketed and subsequently banned during the 1950s and 60s, until the present, when an apparently irreversible process of rehabilitating the drug is under way. Brazilian experience with the use of thalidomide is described, emphasizing legal, political, and institutional work led by two social movements, the Brazilian Association of People with Thalidomide Syndrome (ABPST) and the Movement for Reintegration of People with Hansen's Disease (Morhan). The article describes the results and analyzes an active search of new cases in what is a second generation of thalidomide syndrome in Brazil. Finally, based on clinical and scientific evidence of thalidomide's therapeutic efficacy, the growth of social movements struggling both for and against authorization of the drug, and a restrictive regulation proposed by the Ministry of Health, the article discusses the implementation of policies for the regulation and rational use of thalidomide in Brazil.