The powder diffraction method, by using conventional X-ray sources, was devised independently in 1916 by Debye and Scherrer in Germany and in 1917 by Hull in the United States. The technique developed steadily and, half a century later, the 'traditional' applications, such as phase identification, the determination of accurate unit-cell dimensions and the analysis of structural imperfections, were well established. There was then a dramatic increase of interest in powder methods during the 1970s, following the introduction by Rietveld in 1967 of his powerful method for refining crystal structures from powder data. This has since been used extensively, initially by using neutron data and later with X-rays, and it was an important step towards extracting 3-dimensional structural information from 1-dimensional powder diffraction patterns, in order to study the structure of crystalline materials. Similarly, techniques which do not involve structural data have been introduced for modelling powder diffraction patterns, to extract various parameters (position, breadth, shape, etc.) which define the individual reflections. These are used in most applications of powder diffraction and are the basis of new procedures for characterizing the microstructural properties of materials. Many subsequent advances have been based on this concept and powder diffraction is now one of the most widely used techniques available to materials scientists for studying the structure and microstructure of crystalline solids. It is thus timely to review progress during the past twenty years or so.Powder data have been used for the identification of unknown materials or mixtures of phases since the late 1930s. This is achieved by comparison of experimental data with standard data in crystallographic databases. The technique has benefited substantially from the revolution in the development of storage media during the last decade and from the introduction of fast search/match algorithms. Phase identification sometimes precedes a quantitative analysis of compounds present in a sample and powder diffraction is frequently the only approach available to the analyst for this purpose. A new development in quantitative analysis is the use of the Rietveld method with multi-phase refinement.A major advance in recent years has occurred in the determination of crystal structures ab initio from powder diffraction data, in cases where suitable single crystals are not available. This is a consequence of progress made in the successive stages involved in structure solution, e.g. the development of computer-based methods for determining the crystal system, cell dimensions and symmetry (indexing) and for extracting the intensities of Bragg reflections, the introduction of high resolution instruments and the treatment of