Somatostatin is produced in enteroendocrine D cells and intrinsic neurons of the stomach, intestines and pancreas. Its physiologic actions are mediated primarily by somatostatin receptors type 2 and 5, and include the inhibition of secretion of most endocrine and exocrine factors. Diseases directly attributable to somatostatin excess or deficiency are rare, although there is a complex pathogenic relationship between persistent Helicobacter pylori infection and reduced somatostatin in chronic gastritis. Abundant somatostatin receptors on many neoplastic and inflammatory cells are the basis for sensitive in vivo imaging with radiolabeled somatostatin analogs and provide a therapeutic target. Current indications for somatostatin therapy include hormone-expressing neuroendocrine tumors, intractable diarrhea and variceal bleeding secondary to portal hypertension. Exciting advances are being made in the development of high-affinity nonpeptide analogs with receptor-subtype selectivity and increased bioavailability. Somatostatin analogs coupled to high-energy radionuclides show promise as novel cytotoxic agents for certain metastatic tumors.