In this article, we briefly review the potential of myxobacteria as ‘natural product factories’ by highlighting results from the recently sequenced myxobacterial model strain Myxococcus xanthus. We will focus on the production of polyketides, non-ribosomally-made peptides, and their hybrids, and discuss the evaluation of biosynthetic potential using genome-based methods, as well as biosynthetic process engineering.