Multiple myeloma (MM) is characterized by the malignant expansion of differentiated plasma cells. Although many chemotherapeutic agents display cytotoxic activity toward MM cells, patients inevitably succumb to their disease because the tumor cells become resistant to the anticancer drugs. The cancer stem cell hypothesis postulates that a small subpopulation of chemotherapy-resistant cancer cells is responsible for propagation of the tumor. Herein we report that efflux of the pluripotent stem cell dye CDy1 identifies a subpopulation in MM cell lines characterized by increased expression of P-glycoprotein, a member of the ABC (ATP-binding cassette) superfamily of transporters encoded by ABCB1. We also demonstrate that ABCB1-overexpressing MM cells are resistant to the second-generation proteasome inhibitor carfilzomib that recently received accelerated approval for the treatment of therapy-refractive MM by the U.S. Food and Drug Administration. Moreover, increased resistance to carfilzomib in sensitive MM cells following drug selection was associated with upregulation of ABCB1 cell-surface expression which correlated with increased transporter activity as measured by CDy1 efflux. We further show that chemosensitization of MM cells to carfilzomib could be achieved in vitro by cotreatment with vismodegib, a hedgehog pathway antagonist which is currently in MM clinical trials. CDy1 efflux may therefore be a useful assay to determine whether high expression of ABCB1 is predictive of poor clinical responses in MM patients treated with carfilzomib. Our data also suggest that inclusion of vismodegib might be a potential strategy to reverse ABCB1-mediated drug resistance should it occur. Am. J. Hematol. 88:265–272, 2013. © 2013 Wiley Periodicals, Inc.