The role of osmolytes, and especially trehalose, in stabilizing proteins under stress conditions is now a widely accepted fact. The physical and chemical properties of trehalose, i.e., low chemical reactivity, nonreducing nature, high glass transition temperature, high affinity for water molecules, existence of a number of polymorphs, etc., make it uniquely suitable for stabilizing partially unfolded protein molecules and inhibiting protein aggregation. This article discusses the various adverse situations that protein molecules face, both within the cell and outside, leading to their aggregation and inactivation. The use of trehalose in stabilizing protein molecules and helping them retain their functionally active forms under such conditions is examined. The various theories and mechanisms used to explain the protective action of trehalose are briefly presented. The experimental tools that can be used to decipher the mechanism of aggregation and the role of trehalose are also discussed.