Wireless capsule endoscopy offers a revolutionary diagnostic tool for small bowel diseases. Since its formal introduction, it has become an integral part of the diagnostic evaluation for obscure gastrointestinal bleeding. This relatively noninvasive imaging modality offered by small bowel capsule endoscopy is appealing to both patients and providers and consequently, the desire to expand its diagnostic role continues to grow. The use of CE in the diagnosis of Crohn disease and chronic diarrhea is being further investigated, as is the potential of employing this technique as a cancer surveillance mechanism in patients with hereditary polyposis syndromes which may involve the small bowel. This review article discusses the current indications for small bowel capsule endoscopy, the results of capsule endoscopy in patients with obscure gastrointestinal bleeding and small bowel diseases, and patient outcomes following capsule endoscopy. Capsule endoscopy is compared with traditional diagnostic modalities, including small bowel series, enteroclysis, CT, and push enteroscopy. Small bowel capsule endoscopy is the procedure of choice to evaluate obscure gastrointestinal bleeding, and is superior to radiographic procedures in detecting Crohn disease of the small bowel.