Understanding the determinants of inter-individual variations in drug response is critical to improve efficacy and reduce toxicity of pharmaceuticals, including anti-cancer agents. One underappreciated factor is the gut microbiome, which we demonstrate influences drug metabolism and absorption through two independent, mechanistic studies. First, we show that 5-fluorouracil (5-FU), a standard of care therapy for colorectal cancer, is inactivated by a gut bacterial enzyme PreTA, which led to decreased 5-FU bioavailability and reduced efficacy in mouse tumor model. PreTA encoded by diverse gut organisms was also prevalent at varying levels in colorectal cancer patients, which may contribute to observed variations in treatment outcomes. Second, we test whether the gut microbiome could influence absorption of oral drugs. Mice mono-colonized with a prevalent human gut Actinobacterium Eggerthella lenta had higher intestinal absorption of digoxin, a cardiac drug with a narrow therapeutic window used in heart failure. Using an in vitro system with human colonocytes, we find that E. lenta secretes small polar molecule(s) that inhibits P-glycoprotein, a key mammalian efflux drug transporter involved in cancer resistance, by inhibiting its ATPase activity. Untargeted metabolomics revealed the E. lenta derived inhibitor to be an isoflavonoid, a class of natural metabolites with known P-gp inhibitors. Our findings emphasize the importance of gut microbiome for drug disposition, representing an untapped rich resource to enable precision medicine.