Purpose: Bispecific antibodies (BsAb) have been exploited as both cancer immunodiagnostics and cancer therapeutics and show promise in clinical trials of cancer imaging and therapy. For development of BsAbs as clinical reagents, we have focused on construction of small recombinant BsAbs, called bispecific diabodies. Here, we constructed and characterized a humanized bispecific diabody. Experimental Design: We have reported significant antitumor activity of an anti-epidermal growth factor receptor (EGFR) x anti-CD3 bispecific diabody (Ex3) in in vitro cytotoxicity assays and in vivo. We humanized the Ex3 diabody (hEx3) by grafting the complementarity-determining region and compared its biological properties with those of Ex3. We also tested its physiologic stability and ability to alter survival in xenografted mice. Results: The final yield of hEx3 was 10 times that of Ex3, and refolded hEx3 and Ex3 showed identical binding profiles in EGFR-positive cell lines and EGFR-transfected Chinese hamster ovary cells. hEx3 showed dose-dependent cytotoxicity to EGFR-positive ceil lines, which could be specifically inhibited by parental monoclonal antibody IgGs against EGFR or CD3 antigens. The heterodimeric structure was retained in PBS for 6 months, and growth inhibition was maintained after incubation under physiologic conditions. Coadministration of hEx3 withT-LAK cells and interleukin-2 prolonged the survival of nude mice with human colon carcinoma. Conclusions: The humanized diabody hEx3 is an attractive molecule for cancer therapy and may provide important insights into the development of EGFR-based cancer-targeting reagents.