A capsule endoscope is a swallowable wireless miniature camera for getting images of the gastrointestinal (GI) mucosa. The initial capsule endoscope model was developed by Given Imaging and approved in Western countries in 2001. Before the introduction of capsule endoscopy (CE) and double-balloon endoscopy (DBE), there was no effective modality for the evaluation and management of patients with obscure GI bleeding. Obscure GI bleeding is defined as bleeding of unknown origin that persists or recurs after a negative initial or primary endoscopy (colonoscopy or upper endoscopy) result. The first capsule endoscope model, which is now regarded as a first-line tool for the detection of abnormalities of the small bowel, was the PillCam SB. It was approved in Japan in April 2007. The main indication for use of the PillCam SB is obscure GI bleeding. Almost the only complication of CE is capsule retention, which is the capsule remaining in the digestive tract for a minimum of 2 weeks. A retained capsule can be retrieved by DBE. There are some limitations of CE in that it cannot be used to obtain a biopsy specimen or for endoscopic treatment. However, the combination of a PillCam SB and DBE seems to be the best strategy for management of obscure GI bleeding. Recently, several new types of capsule endoscope have been developed, such as Olympus CE for the small bowel, PillCam ESO for investigation of esophageal diseases, and PillCam COLON for detection of colonic neoplasias. In the near future, CE is expected to have a positive impact on many aspects of GI disease evaluation and management.