Betulin (lup-20(29)-ene-3beta,28-diol) is an abundant naturally occurring triterpene and it is found predominantly in bushes and trees forming the principal extractive (up to 30% of dry weight) of the bark of birch trees. Presently, there is no significant use for this easily isolable compound, which makes it a potentially important raw material for polymers and a precursor of biologically active compounds. Betulin can be easily converted to betulinic acid, which possesses a wide spectrum of biological and pharmacological activities. Betulinic acid has antimalarial and anti-inflammatory activities. Betulinic acid and its derivatives have especially shown anti-HIV activity and cytotoxicity against a variety of tumor cell lines comparable to some clinically used drugs. A new mechanism of action has been confirmed for some of the most promising anti-HIV derivatives, which makes them potentially useful additives to the current anti-HIV therapy. Betulinic acid is specifically cytotoxic to several tumor cell lines by inducing apoptosis in cells. Moreover, it is non-toxic up to 500 mg/kg body weight in mice. The literature concerning derivatization of betulin for structure-activity relationship (SAR) studies and its pharmacological properties is reviewed.