During the past 5 years balanced steady-state free precession (SSFP) has become increasingly important for diagnostic and functional imaging. Balanced SSFP is characterized by two unique features: it offers a very high signal-to noise ratio and a T2/T1-weighted image contrast. This article focuses on the physical principles, on the signal formation, and on the resulting properties of balanced SSFP. Mechanisms for contrast modification, recent clinical application, and potential extensions of this technique are discussed.