Magnetic resonance imaging (MRI) now provides valuable diagnostic and prognostic information for the management of multiple sclerosis (MS) but the diagnosis still largely rests on the clinical features of central nervous system (CNS) lesions disseminated in time and place. Recent histological and MRI studies indicate that extensive axonal damage can occur in MS, even early in the disease course, and is likely to be an important cause of accumulating disability. Several immunomodulating agents have now been shown to have beneficial effects in MS. High dose intravenous or high dose oral methylprednisolone therapy accelerates recovery from attacks of relapsing-remitting MS, but at present there is no convincing evidence that standard dose (intermediate dose) oral corticosteroid therapy is beneficial for such attacks. Interferon beta, copolymer 1 (glatiramer acetate) and i.v. immunoglobulin therapy each significantly reduce the frequency of attacks of relapsing-remitting MS. Interferon beta also inhibits the progression of disability in relapsing-remitting MS and secondary progressive MS, but its effect on primary progressive MS is unknown. Oral low dose methotrexate therapy slows the progression of disability in secondary progressive MS and possibly in primary progressive MS, but it is likely that the currently used dosage (7.5 mg weekly) is suboptimal. Further research is needed to determine the optimal doses and combinations of the above therapies in MS and to develop better therapies, particularly for primary progressive MS.