Allen was diagnosed with Hodgkin's lymphoma, a type of cancer affecting the lymphatic system. He underwent intensive radiation therapy and chemotherapy.

Due to his health condition and disagreements with Bill Gates about his role in the company, Allen resigned from his executive position at Microsoft. However, he remained on the board and retained a significant ownership stake.

Even after resigning, Allen remained on Microsoft's board of directors until 2000, providing strategic advice and guidance. He also benefitted greatly from Microsoft's continued success as his stock value soared.