Cryptococcus neoformans and Cryptococcus gattii are the cause of life-threatening meningoencephalitis in immunocompromised and immunocompetent individuals respectively. The increasing incidence of cryptococcal infection as a result of the AIDS epidemic, the recent emergence of a hypervirulent cryptococcal strain in Canada and the fact that mortality from cryptococcal disease remains high have stimulated intensive research into this organism. Here we outline recent advances in our understanding of C. neoformans and C. gattii, including intraspecific complexity, virulence factors, and key signaling pathways. We discuss the molecular basis of cryptococcal virulence and the interaction between these pathogens and the host immune system. Finally, we discuss future challenges in the study and treatment of cryptococcosis.