Sesquiterpene lactones are characteristic constituents of the Compositae but also occur sporadically in other angiosperm families and even in some liverworts. These bitter substances often contain as a major structural feature an α,β-unsaturated-γ-lactone, which in recent studies has been shown to be associated with anti-tumor, cytotoxic, anti-microbial and phytotoxic activity. They are known to poison livestock, to act as insect feeding deterrents and to cause allergic contact dermatitis in humans. This review highlights the present state of knowledge on the biological activities and mechanism of action of some sesquiterpene lactones.