Over the last three decades, intravesical immunotherapy with the biological response modifier Mycobacterium bovis bacillus Calmette-Guérin (BCG) has been established as the most effective adjuvant treatment for preventing local recurrences and tumor progression following transurethral resection of non-muscle invasive bladder cancer. A large number of clinical trials have established a major role for BCG immunotherapy in urological oncology. In parallel, the major principles of the immunological mechanism have been revealed. In spite of this success, questions still remain regarding its clinical use, mechanism of action and potential improvement. This review provides a comprehensive insight into the historical era of BCG immunotherapy, the current indications for clinical application, the complex mechanism of action and possible future developments.