Thalidomide was synthesized in 1954 in erstwhile West Germany and marketed as a 
sedative in over 46 countries until the early 1960s. Owing to serious 
teratogenic effects, the drug was withdrawn from the market in 1961. A chance 
observation suggested the utility of thalidomide in erythema nodosum leprosum 
(ENL). After many controlled and uncontrolled trials were published, the World 
Health Organization recommended its use in ENL. The Food and Drug 
Administration, USA approved it for use in ENL in July 1998. Only established 
and well-defined studies conducted to substantiate the efficacy of thalidomide 
have been included in this review. Thalidomide is considered the drug of choice 
for the treatment of ENL, but for other conditions, it is recommended only when 
resistance to the currently available form of therapy is encountered. Once the 
anti-inflammatory, immuno-modulatory, anti-TNF-alpha and anti-angiogenic 
properties of thalidomide were discovered, it was also tried in AIDS and related 
wasting, apthous ulcers, microsporidiosis and Kaposi's sarcoma. Thalidomide has 
no clinical place as an immunosuppressant in solid organ transplantation. 
However, it has a therapeutic role in graft-verus-host-disease. Among the 
dermatological conditions, thalidomide has been found to be effective in 
systemic lupus erythematosus, discoid lupus erythematosus, actinic prurigo and 
prurigo nodularis. Used correctly, it is a safe and effective medicine (except 
for its teratogenic potential and delayed neuropathy) in a variety of disease 
conditions.