Helicobacter pylori, a gram-negative, microaerophilic, motile, spiral-shaped bacterium, has been established as the etiologic agent of gastritis and peptic ulcers and is a major risk factor for gastric adenocarcinoma and mucosa-associated lymphoid tissue lymphoma (MALT). The ability of H. pylori to cause this spectrum of diseases depends on host, bacterial, and environmental factors. Bacterial factors critical for H. pylori colonization of the gastric mucosa include urease, flagella, adhesins, and delta-glutamyltranspeptidase. Lipopolysaccharide, urease, and vacuolating cytotoxin are among the factors that allow H. pylori to persist for decades and invoke an intense inflammatory response, leading to damaged host cells. Genes in the cag pathogenicity island also contribute to the inflammatory response by initiating a signal transduction cascade, resulting in interleukin-8 production. Proinflammatory cytokines and a Th-1 cytokine response further exacerbates the inflammation. Products of the enzymes nitric oxide synthase (iNOS) and cyclooxygenase may perturb the balance between gastric epithelial cell apoptosis (ulcer formation) and proliferation (cancer). The host Th-1 response and antibodies directed against H. pylori do not eliminate the organism, which presents challenges to vaccine development. Vaccines that include urease have shown some promise, but improved adjuvants and animal models should hasten progress in vaccine research. H. pylori is the most genetically diverse organism known, and the panmictic population structure may contribute to the varying ranges of disease severity produced by different strains. The complete genome sequence of two strains of H. pylori has propelled this field forward, and numerous groups are now using genomic, proteomic, and mutagenetic approaches to identify new virulence genes. Discovered only in 1982, H. pylori is now among the most intensely investigated organisms. This review summarizes recent progress in this rapidly moving field.