For many years, the central nervous system (CNS) was considered to be 'immune privileged', neither susceptible to nor contributing to inflammation. It is now appreciated that the CNS does exhibit features of inflammation, and in response to injury, infection or disease, resident CNS cells generate inflammatory mediators, including proinflammatory cytokines, prostaglandins, free radicals and complement, which in turn induce chemokines and adhesion molecules, recruit immune cells, and activate glial cells. Much of the key evidence demonstrating that inflammation and inflammatory mediators contribute to acute, chronic and psychiatric CNS disorders is summarised in this review. However, inflammatory mediators may have dual roles, with detrimental acute effects but beneficial effects in long-term repair and recovery, leading to complications in their application as novel therapies. These may be avoided in acute diseases in which treatment administration might be relatively short-term. Targeting interleukin (IL)-1 is a promising novel therapy for stroke and traumatic brain injury, the naturally occurring antagonist (IL-1ra) being well tolerated by rheumatoid arthritis patients. Chronic disorders represent a greater therapeutic challenge, a problem highlighted in Alzheimer's disease (AD); significant data suggested that anti-inflammatory agents might reduce the probability of developing AD, or slow its progression, but prospective clinical trials of nonsteroidal anti-inflammatory drugs or cyclooxygenase inhibitors have been disappointing. The complex interplay between inflammatory mediators, ageing, genetic background, and environmental factors may ultimately regulate the outcome of acute CNS injury and progression of chronic neurodegeneration, and be critical for development of effective therapies for CNS diseases.