Poor penetration of drugs into tumors is a major obstacle in tumor treatment. We describe a strategy for peptide-mediated delivery of compounds deep into the tumor parenchyma that uses a tumor-homing peptide, iRGD (CRGDK/RGPD/EC). Intravenously injected compounds coupled to iRGD bound to tumor vessels and spread into the extravascular tumor parenchyma, whereas conventional RGD peptides only delivered the cargo to the blood vessels. iRGD homes to tumors through a three-step process: the RGD motif mediates binding to alphav integrins on tumor endothelium and a proteolytic cleavage then exposes a binding motif for neuropilin-1, which mediates penetration into tissue and cells. Conjugation to iRGD significantly improved the sensitivity of tumor-imaging agents and enhanced the activity of an antitumor drug.