The 18 kDa translocator protein (TSPO) is a highly conserved protein located in the outer mitochondrial membrane. TSPO binding, as measured with positron emission tomography (PET), is considered an in vivo marker of neuroinflammation. Indeed, TSPO expression is altered in neurodegenerative, neuroinflammatory, and neuropsychiatric diseases. In PET studies, the TSPO signal is often viewed as a marker of microglial cell activity. However, there is little evidence in support of a microglia-specific TSPO expression. This review describes the cellular sources and functions of TSPO in animal models of disease and human studies, in health, and in central nervous system diseases. A discussion of methods of analysis and of quantification of TSPO is also presented. Overall, it appears that the alterations of TSPO binding, their cellular underpinnings, and the functional significance of such alterations depend on many factors, notably the pathology or the animal model under study, the disease stage, and the involved brain regions. Thus, further studies are needed to fully determine how changes in TSPO binding occur at the cellular level with the ultimate goal of revealing potential therapeutic pathways.