Abstract Histopathological grading of epithelial dysplasia remains the principal laboratory method for assessing the risk of malignant transformation in oral potentially malignant disorders (OPMDs). Current views on the molecular pathogenesis and histological interpretation of the features of epithelial dysplasia are described, and the use of grading systems for epithelial dysplasia is discussed. Changes to the current 2017 WHO criteria for diagnosis are proposed with emphasis on the architectural features of epithelial dysplasia. The predictive values of three‐grade and binary systems are summarised, and categories of epithelial dysplasia are reviewed, including lichenoid and verrucous lesions, keratosis of unknown significance, HPV‐associated dysplasia, differentiated and basaloid epithelial dysplasia. The implications of finding epithelial dysplasia in an oral biopsy for clinical management are discussed from the pathologists' viewpoint.