Peer-to-peer (P2P) networks are gaining popularity in many applications such as file sharing, e-commerce, and social networking, many of which deal with rich, distributed data sources that can benefit from data mining. P2P networks are, in fact,well-suited to distributed data mining (DDM), which deals with the problem of data analysis in environments with distributed data,computing nodes,and users. This article offers an overview of DDM applications and algorithms for P2P environments,focusing particularly on local algorithms that perform data analysis by using computing primitives with limited communication overhead. The authors describe both exact and approximate local P2P data mining algorithms that work in a decentralized and communication-efficient manner.