<jats:sec><jats:title>SUMMARY</jats:title><jats:p>Complementary and alternative medicines such as tea tree (melaleuca) oil have become increasingly popular in recent decades. This essential oil has been used for almost 100 years in Australia but is now available worldwide both as neat oil and as an active component in an array of products. The primary uses of tea tree oil have historically capitalized on the antiseptic and anti-inflammatory actions of the oil. This review summarizes recent developments in our understanding of the antimicrobial and anti-inflammatory activities of the oil and its components, as well as clinical efficacy. Specific mechanisms of antimicrobial and anti-inflammatory action are reviewed, and the toxicity of the oil is briefly discussed.</jats:sec>