Tumor 'budding', loosely defined by the presence of individual cells and small clusters of tumor cells at the invasive front of carcinomas, has received much recent attention, particularly in the setting of colorectal carcinoma. It has been postulated to represent an epithelial-mesenchymal transition. Tumor budding is a well-established independent adverse prognostic factor in colorectal carcinoma that may allow for stratification of patients into risk categories more meaningful than those defined by TNM staging, and also potentially guide treatment decisions, especially in T1 and T3 N0 (Stage II, Dukes' B) colorectal carcinoma. Unfortunately, its universal acceptance as a reportable factor has been held back by a lack of definitional uniformity with respect to both qualitative and quantitative aspects of tumor budding. The purpose of this review is fourfold: (1) to describe the morphology of tumor budding and its relationship to other potentially important features of the invasive front; (2) to summarize current knowledge regarding the prognostic significance and potential clinical implications of this histomorphological feature; (3) to highlight the challenges posed by a lack of data to allow standardization with respect to the qualitative and quantitative criteria used to define budding; and (4) to present a practical approach to the assessment of tumor budding in everyday practice.