Over the last decades considerable evidence has accumulated indicating that glucocorticoids - stress hormones released from the adrenal cortex - are crucially involved in the regulation of memory. Specifically, glucocorticoids have been shown to enhance memory consolidation of emotionally arousing experiences, but impair memory retrieval and working memory during emotionally arousing test situations. Furthermore, growing evidence indicates that these different glucocorticoid effects all depend on emotional arousal-induced activation of noradrenergic transmission within the basolateral complex of the amygdala (BLA) and on interactions of the BLA with other brain regions, such as the hippocampus and neocortical regions. Here we review findings from both animal and human experiments and present an integrated perspective of how these opposite glucocorticoid effects might act together to serve adaptive processing of emotionally significant information. Furthermore, as intense emotional memories also play a crucial role in the pathogenesis and symptomatology of anxiety disorders, such as posttraumatic stress disorder (PTSD) or phobias, we discuss to what extent the basic findings on glucocorticoid effects on emotional memory might have implications for the understanding and treatment of these clinical conditions. In this context, we review data suggesting that the administration of glucocorticoids might ameliorate chronic anxiety by reducing retrieval of aversive memories and enhancing fear extinction.