The genus Malassezia comprises lipophilic species, the natural habitat of which is the skin of humans and other warm-blooded animals. However, these species have been associated with a diversity of dermatological disorders and even systemic infections. Pityriasis versicolor is the only cutaneous disease etiologically connected to Malassezia yeasts. In the other dermatoses, such as Malassezia folliculitis, seborrheic dermatitis, atopic dermatitis, and psoriasis, these yeasts have been suggested to play pathogenic roles either as direct agents of infection or as trigger factors because there is no evidence that the organisms invade the skin. Malassezia yeasts have been classified into at least 14 species, of which eight have been isolated from human skin, including Malassezia furfur, Malassezia pachydermatis, Malassezia sympodialis, Malassezia slooffiae, Malassezia globosa, Malassezia obtusa, Malassezia restricta, Malassezia dermatis, Malassezia japonica, and Malassezia yamatoensis. Distributions of Malassezia species in the healthy body and in skin diseases have been investigated using culture-based and molecular techniques, and variable results have been reported from different geographical regions. This article reviews and discusses the latest available data on the pathogenicity of Malassezia spp., their distributions in dermatological conditions and in healthy skin, discrepancies in the two methods of identification, and the susceptibility of Malassezia spp. to antifungals.