Acute disseminated encephalomyelitis (ADEM) is an uncommon inflammatory demyelinating disease of the central nervous system. The true incidence of the disease in India is undetermined and is likely to be more frequent than reported, as the common antecedent events, exanthematous fevers and Semple antirabies vaccination, which predispose to ADEM, are still prevalent. The existing evidence suggests that ADEM results from a transient autoimmune response towards myelin or other self-antigens, possibly via molecular mimicry, or by non-specific activation of auto-reactive T cell clones. ADEM is a monophasic illness with favourable long-term outcome. Involvement of neuroaxis is variable and can be diffuse or multifocal and site restricted. Magnetic resonance imaging (MRI) is highly sensitive in detecting white matter lesions and the lesions described are rather extensive and subcortical in location. Involvement of the deep gray matter, particularly basal ganglia, is more frequent. Oligoclonal bands in CSF are usually absent. No therapy has been established by controlled trials in ADEM. Use of high-dose methylprednisolone, plasma exchange, and IVIG are based on the analogy of the pathogenesis of ADEM with that of multiple sclerosis (MS). Differentiation of ADEM from the first attack of MS is important from prognostic as well as therapeutic point of view. However, in the absence of biological marker, at times differentiation of ADEM from the initial presentation of MS may not be possible even by combination of clinical, CSF analysis, and MRI. This differentiation is more relevant to India where the incidence of MS is low.