This article discusses opportunities and challenges for efficient parallel data processing in cloud computing environments. It introduces Nephele, a new data processing framework designed specifically for clouds. Nephele is the first framework to leverage dynamic resource allocation in clouds for task scheduling and execution. The article analyzes how existing frameworks assume static resource environments unlike clouds, and how Nephele addresses this by dynamically allocating different compute resources during job execution. It then provides initial performance results for Nephele and compares it to Hadoop for MapReduce-style jobs on cloud infrastructure.