OBJECTIVES:~Determine whether the combination of epoetin alfa and thalidomide improves the anemia and/or decreases the need for red cell transfusion in patients with low- or intermediate-risk myelodysplastic syndromes.~Determine whether this regimen improves the bone marrow morphology and cytogenetics, alters the natural history of the disease, and reduces the frequency of leukemic transformation in these patients.~Evaluate whether this regimen improves pathophysiologic parameters (e.g., apoptosis, tumor necrosis factor-alpha concentration, microvessel density, vascular endothelial growth factor, and cytotoxic T lymphocytes) in the bone marrow of these patients.~Determine the safety of this regimen in these patients.~OUTLINE: Patients receive epoetin alfa subcutaneously (SC) once weekly for 8 weeks. After 8 weeks, patients unresponsive to epoetin alfa alone receive oral thalidomide once daily in addition to epoetin alfa SC once weekly for a maximum of 24 weeks in the absence of disease progression or unacceptable toxicity.~PROJECTED ACCRUAL: A total of 30-40 patients will be accrued for this study within 2 years..
RATIONALE: Thalidomide may stop or slow the growth of cancer cells. Epoetin alfa may stimulate red blood cell production. Combining thalidomide with epoetin alfa may improve anemia, decrease the need for blood transfusions, and improve the quality of life in patients with myelodysplastic syndrome.~PURPOSE: Phase II trial to study the effectiveness of combining thalidomide with epoetin alfa in treating anemia in patients who have myelodysplastic syndrome.