Confocal laser endomicroscopy (CLE) is an advanced imaging technique which combines conventional white light endoscopy (WLE) with an integrated or probe based confocal microscope. This allows microscopic examination of the surface epithelium and in vivo diagnosis during endoscopy. Established CLE applications include the diagnosis of Barrett's oesophagus, gastric intestinal metaplasia, coeliac disease and microscopic colitis. CLE can differentiate hyperplastic from adenomatous polyps in the colon and may obviate the need to biopsy all polyps at endoscopy. CLE is particularly helpful in surveillance endoscopy in inflammatory bowel disease where it has been shown to reduce the number of biopsies required and improve the detection of dysplasia. The future of CLE may be with new contrast agents to allow for molecular tagging and improved endoscopic diagnoses. The aim of this review is to describe the technology and techniques involved in CLE, and discuss the evolving applications in obtaining "virtual biopsy" throughout the GI tract.