Tolterodine is a new, potent and competitive muscarinic receptor antagonist in clinical development for the treatment of urge incontinence and other symptoms of unstable bladder. Tolterodine has a high affinity and specificity for muscarinic receptors in vitro and it exhibits a selectivity for the urinary bladder over salivary glands in vivo. A major active metabolite, (PNU-200577) the 5-hydroxymethyl derivative of tolterodine, has a similar pharmacological profile. Based on pharmacological and pharmacokinetic data, it has been concluded that this metabolite contributes significantly to the therapeutic effect of tolterodine. The bladder selectivity demonstrated by tolterodine and PNU-200577 in vivo cannot be attributed to selectivity for a single muscarinic receptor subtype. Moreover, this favourable tissue-selectivity seems to occur also in humans. Tolterodine is well tolerated and it exerts a marked effect on bladder function in healthy volunteers. Phase II data indicate that tolterodine is an efficacious and safe treatment for patients with idiopathic detrusor instability or detrusor hyperreflexia. An optimal efficacy/side-effect profile is obtained with tolterodine, at a dosage of 1 or 2 mg twice daily, which seems to have less propensity to cause dry mouth than the currently available antimuscarinic drugs.