This review focuses on the major developments in depsipeptide research since 1995. Depsipeptides are bio-oligomers composed of hydroxy and amino acids linked by amide and ester bonds. Many depsipeptides show very promising biological activities, including anticancer, antibacterial, antiviral, antifungal, anti-inflammatory, and anti-clotting or anti-antherogenic properties. In this report depsipeptides exhibiting these properties are discussed. Their isolation, structural determination, and notable structural features are discussed, but their biological properties and therapeutic potentials are emphasized. Depsipeptides have shown the greatest therapeutic potential as anticancer agents. Four depsipeptides have entered clinical trials for cancer treatment. Among the antiviral compounds discovered, the callipeltins and the quinoxapeptins are particularly promising due to their inhibitory activities against HIV. These compounds have the potential to be developed as anti-AIDS drugs or to serve as lead compounds for the discovery of structurally related anti-AIDS compounds. Antifungal compounds, such as the jaspamides, may lead to therapies against many of the opportunistic infections that accompany AIDS. Anti-inflammatory compounds such as SCH217048 act as neurokinin antagonists and may lead to anti-inflammatory treatments. Some depsipeptides such as micropeptins and A90720A have been found to be effective plasmin inhibitors, which have implications as treatments for cardiovascular diseases. Compounds such as SCH58149 help control the levels of HDL and LDL.