The treatment of a variety of inflammatory skin diseases was greatly changed by the introduction, in the early 1950s, of corticosteroids for topical use. Topical corticosteroids are still the most widely used drugs in dermatology, and many preparations with quite different potencies are now available. However, attempts to eliminate the local and systemic side effects associated with topical corticosteroid therapy have not been entirely successful. Thus, dermatologists are now seeking a preparation with moderate to potent anti-inflammatory activity, which is strictly limited to the skin and has minimal or no passage into the systemic circulation, minimal or no local and/or systemic side effects and no wear-off effects. The list of dermatoses that are sensitive to treatment with topical corticosteroids is well known. However, recent reports suggest other indications, such as bullous pemphigoid, pemphigus and actinic reticuloid. The observation that potent topical corticosteroids under occlusion induce loss of dermal mast cells has opened a new therapeutic field (e.g. mastocytosis, urticaria pigmentosa) for the use of these compounds. Although topical corticosteroids have been the most extensively studied drugs in dermatology, many questions remain unanswered. We are beginning to learn about the biochemistry of glucocorticoid activity in the skin, and there is little doubt that increased knowledge in this field will help optimise the activity of these drugs. Topical corticosteroid formulations can be improved, and a better definition of proper dosage schedules is needed for each category, as defined by topical corticosteroid potency, to lower the risk-benefit ratio.(ABSTRACT TRUNCATED AT 250 WORDS)