Microsatellites, or tandem simple sequence repeats (SSR), are abundant across genomes and show high levels of polymorphism. SSR genetic and evolutionary mechanisms remain controversial. Here we attempt to summarize the available data related to SSR distribution in coding and noncoding regions of genomes and SSR functional importance. Numerous lines of evidence demonstrate that SSR genomic distribution is nonrandom. Random expansions or contractions appear to be selected against for at least part of SSR loci, presumably because of their effect on chromatin organization, regulation of gene activity, recombination, DNA replication, cell cycle, mismatch repair system, etc. This review also discusses the role of two putative mutational mechanisms, replication slippage and recombination, and their interaction in SSR variation.