Basal cell carcinoma (BCC) is the most common malignant neoplasm of humans. Rising dramatically in incidence in North America, as likely reflects changing habits of the population and a move from more northerly climes to the sunbelt of the Southern and Southwestern United States, the incidence is surely to rise even higher in the future. The last decade has seen significant advances in our understanding of BCC biology and novel approaches to therapy, which hinge upon accurate diagnosis and subclassification by pathologists. The purpose of this review article is to summate the research advances in our understanding of BCC biology and to acquaint pathologists and clinicians to the practical issues in BCC diagnosis and subclassification which flow there from.