A rapidly spreading, highly pathogenic avian influenza virus A H5N1 in the domestic poultry population has crossed the species barrier to humans and other mammalian species, thus, posing an increasing pandemic threat. The World Health Organization, other agencies, and countries worldwide are closely monitoring the prevalent influenza viruses and their related illnesses to detect any increased virulence or transmissibility that might signal the beginnings of any future pandemic. So far, the H5N1 virus has infected birds in more than 30 countries in Asia, Europe and Africa, while further geographical spread remains likely. Human infections are still rare and the virus does not spread easily from birds to humans or readily from person to person. Although antiviral drugs and vaccination are among the most important measures to be used in case of an influenza pandemic, a timely supply of sufficient quantities will not be possible. This review describes various aspects of avian influenza in birds and in humans; epidemiology, transmission, diagnosis and clinical manifestations. Also presented are the global preparedness, the anti-influenza drugs and vaccines.